Finance Secretary Carlos Dominguez 3rd announced that the LandBank of the Philippines has begun implementing a Japan-funded $40 million (P1.76 billion) project to jumpstart agribusiness investments and raise farmers’ incomes in the Autonomous Region in Muslim Mindanao (ARMM) and other conflict-affected areas in Southern Philippines.
The loan agreement for this program – the Harnessing Agribusiness Through Robust and Vibrant Entrepreneurship Support of Peaceful Transformation (Harvest) – was signed by the LandBank and the Japan International Cooperation Agency (JICA) last January, based on JICA documents, that took effect on June 9.
“The Harvest program which we signed with (JICA) a few months ago is now ongoing,” Dominguez said at a recent briefing in Malacañang. “The terms (of the loan agreement) are very, very liberal. The interest rates are extremely low so you can almost say they are ‘semi-grants’.”
The Harvest program is included in the list of P315 billion projects that the Philippines proposed for financing by Japan during the second meeting of the Philippine-Japan high level joint committee on infrastructure development and economic cooperation.
The loan deal was among the agreements signed between Manila and Tokyo during Japan Prime Minister Shinzo Abe’s two-day visit to the Philippines in January.
The loan offers a very low interest rate of 1.4 percent per annum with 18 years repayment scheme and a seven-year grace period, for a total maturity period of 25 years.
It will implement from 2017 to 2022, that Landbank aims to open a lending window for agribusiness ventures and other related investments in ARMM and other conflict-affected areas in Mindanao.
According to the Department of Finance, loans under the Harvest program will be available to large agribusiness enterprises, farmers’ organizations or cooperatives, micro, small and medium enterprises as well as “corporatives” or corporation-managed farms the LandBank supports in the area.