Asian Infrastructure Investment Bank (AIIB) president Jin Liqun has expressed enthusiasm in finalizing Philippine infrastructure projects for financing by the China-led multilateral lender after the Senate ratified the bank’s Articles of Agreement.
Two initial projects that the AIIB will co-finance in the Philippines with other multilateral lending institutions are the Metro Manila Flood Management Project and the EDSA Bus Rapid Transit system.
“We are all very eager to finalize the infrastructure projects in your country … This time, we are very happy we can really talk about something to do in your country,” Jin said in a recent meeting with Philippine officials led by Finance Secretary Carlos Dominguez 3rd.
The P23.46-billion Metro Manila flood control project supported by the World Bank is now being processed for project financing by the National Economic and Development Authority (NEDA).
On the other hand, the P37.76 billion EDSA Bus Rapid Transit system is partly funded by the Asian Development Bank (ADB).
The ADB support for this land transport project excludes the Public-Private Partnership portion of the project cost, which the NEDA hopes would be backed by the AIIB.
Dominguez has strongly backed the Philippines’ membership to the AIIB, which, he said, would provide the government “another source of long-term funding at very reasonable interest rates.”
“Achieving full membership in the AIIB is a significant milestone. Completing our domestic procedures for ratification puts us in solidarity with 56 other countries,” he said.
“We’d like to thank you very much for speeding up the ratification so that we can start very soon. We believe there is so many that we can do in your country,” Jin told Dominguez during the meeting.
Also with Jin at the lunch meeting were Dr. Supee Teravaninthorn, AIIB director general; Najeeb Haider, principal strategy officer of the Bank; Yong Zhou, senior advisor to the AIIB president; and Huan Chen, Jin’s chief of office.
With Dominguez were Senator Loren Legarda, Budget Secretary Benjamin Diokno, Public Works Secretary Mark Villar, NEDA director general and Socioeconomic Planning Secretary Ernesto Pernia, Finance Undersecretary Antonette Tionko, and Finance Assistant Secretary Edita Tan.
Jin recalled that last year, the previous administration barely beat the deadline on Dec. 31, 2015 to make the Philippines a founding member of the AIIB.
Under the Articles of Agreement of the AIIB, the Philippines as a founding member will get an allocation of 600 Founding Member votes on top of its Basic Votes and Share Votes.
Jin explained that the AIIB focuses on infrastructure and other productive sectors rather than on direct poverty eradication initiatives because the Bank believes that “poverty reduction is the derivative of economic development.”
“This is our difference. We may finance other productive sectors, not just infrastructure. (That includes) industrialization, manufacturing because we believe developing countries need to move up on the value chain. And if you help them, then you can help them to be able to generate income,” Jin said.
“Compared to ADB and World Bank, it will take less than half a year in AIIB to process loans,” he said.
The AIIB also offers technical assistance to less developed countries.
The bank is owned by 57 sovereign-member countries with a total capitalization of US$100 billion.