A 4.93- billion yen agribusiness lending project signed recently between the Philippines and Japan will help increase economic activity in conflict-stricken areas in Mindanao, the Department of Finance (DOF) said on Tuesday.
“The HARVEST project is seen [helping]create an enabling investment environment in the ARMM and other conflict-affected areas in Southern Philippines to help rev up the economy and raise incomes in these communities,” Finance Secretary Carlos Dominguez 3rd said in a statement.
Dominguez is referring to the 4.93-billion yen Harnessing Agribusiness Opportunities through Robust and Vibrant Entrepreneurship Supportive of Peaceful Transformation (HARVEST) Project recently signed by the state-owned Land Bank of the Philippines (LandBank) and the government of Japan.
The loan aims to jumpstart investments in agribusiness in the Autonomous Region in Muslim Mindanao (ARMM) and other conflict-affected areas in the south.
The loan deal was among the agreements signed between Manila and Tokyo during Prime Minister Abe’s two-day state visit to the Philippines last week.
The DOF said the 4.93-billion yen loan matures in 25 years—including a seven-year grace period—with an interest rate of 1.4 percent.
On top of the proposed loan, JICA intends to provide a technical grant of $6 million or P290 million to support the capacity building of eligible HARVEST beneficiaries and LandBank’s project management, it added.
HARVEST, which will be implemented by the LandBank from 2017 to 2022, aims to open a lending window for agribusiness ventures and related investments in the ARMM and other conflict-affected areas in Mindanao.
Loans funded under the HARVEST project will be made available to large agribusiness enterprises, farmers’ organizations or cooperatives, micro, small and medium enterprises (MSMEs) as well as “corporatives” or corporation-managed farms supported by the LandBank in ARMM and other conflict-affected areas.
According to the DOF, projects that source or obtain products or goods from the ARMM and other covered areas as part of a value chain are also qualified to borrow from the HARVEST facility.