THE Japanese government and the national government are poised to operationalize the Philippines Water Revolving Fund (PWRF) that will allow local government units (LGUs) and government-owned and -controlled corporations (GOCCs) access to official development assistance (ODA) loans, according to the National Economic and Development Authority (Neda).

Neda deputy director general Rolando Tungpalan said the Japanese government, through the Japan Bank for International Cooperation (JBIC), has discussed its appraisal of the Development Bank of the Philippines’ (DBP) Environment Development Program (EDP), which is seen to cost P10 billion and will be the anchor project for the PWRF.

“We hope to sign the record of discussion within the week. The appraisal also showed that the demand [for the fund] is higher than earlier expected,” Tungpalan said.

“This is an instrument that the DBP, Japan and the United States can use to encourage private-financing institutions to [help] fund water projects [in the country],” he added.

The EDP loan has an interest rate of 1.4 percent and is payable over a period of 30 years with a 10-year grace period. However, the Neda said that some components of the projects will have lower interest rates and longer repayment periods.

These include the subloan for water supply which has a 0.65-percent-per-annum interest rate and consultancy services with a 0.01-percent annual interest rate. Both subloans have repayment periods of 40 years and a grace period of 10 years.

The PWRF is a fund that will mix ODA and private loans to help LGUs and GOCCs, even those that are considered not creditworthy, access loans for water and sanitation projects.

The fund will secure funding through a loan from JBIC to the DBP, which is the administrator of the fund. As administrator, the DBP will be responsible for setting a special lending window to implement the PWRF; the initial credit, technical and environmental assessment of loan applications; coordination of the approval of loans between the DBP and private-financing institutions; and monitoring the project throughout the lifespan of the loan.

The final interest rate to be marketed by the DBP to those who wish to avail themselves of the loan will be a leveraged form of the concessional interest rate of the ODA, the interest rate of the local bank, and a spread for the DBP.

The initial interest rate computed by the DBP is around 9.57 percent annually for each loan approved under the PWRF.

Under Executive Order 279, which calls for the reform of financing policies for the water supply and sewerage sector and water service providers and mandated the reorganization of the Local Water Utilities Administration (LWUA), it mandated the agency to classify water districts according to credit worthiness.

Those deemed creditworthy by the LWUA were no longer allowed to access ODA funds through the water agency. However, through the fund, these water districts may access ODA and take advantage of lower rates.

On the other hand, water districts that are not creditworthy, can also obtain access to private financing through the fund while enjoying lower rates and longer repayment periods.

THE Philippines would do well to take a cue from China, which has been able to produce enough rice to feed its more than 1 billion population through massive planting of hybrid rice, said SL Agritech Corp. chairman Henry Lim.

THE New York-based Citi Group, one of the world’s largest financial-services firms, said the Philippines deserves more credit than Moody’s Investor Services has given it.

THE Japanese government and the national government are poised to operationalize the Philippines Water Revolving Fund (PWRF) that will allow local government units (LGUs) and government-owned and -controlled corporations (GOCCs) access to official development assistance (ODA) loans, according to the National Economic and Development Authority (Neda).

MALACAÑANG’S wish for early ratification of the Japan Philippines Economic Partnership Agreement (Jpepa) ran into another obstacle Wednesday after three senators voiced doubts on the legality of a proposal by foreign relations committee chairman Sen. Miriam Santiago for the Senate to vote for conditional concurrence to the controversial treaty.

DAVAO CITY—Swedish Ambassador Inger Ultvedt advised the Philippines to make governance transparent and accountable and put a brake to the sending of too many talented people abroad.

HAGATNA, Guam—The Guam tourism office on Tuesday urged mayors from the Philippines to promote a two-way traffic for tourism between the Philippines and Micronesia by encouraging Filipino travelers to consider the region as their destination.

THE slowing world economy and rising inflation will be the major hurdles that Philippine businesses will deal with in 2008. This, according to Samie Lim, president of the Philippine Chamber of Commerce and Industry (PCCI) who spoke at the launching this week of the book  Whither the Philippines in the 21st Century in Makati City.

CEMENT literally is a major “building block” both of the ancient and modern times.

The  Assyrians and Babylonians used cement in the form of clay, and the Egyptians advanced to the discovery of lime and gypsum mortar as a binding agent for building structures such as the pyramids.