The United Kingdom has offered the Philippines a chance to tap its £4.5-billion export-import facility as a financing option for the Duterte Administration’s massive infrastructure program, the Department of Finance (DoF) said over the weekend.
In a statement, the DoF said Finance Secretary Carlos Dominguez 3rd explained to UK Secretary of State for International Trade Liam Fox in a recent meeting the Philippine government’s focus on reversing the current income inequality in the country by fixing the infrastructure backlog and improving connectivity among the regions.
“The opportunities are already there, it is just a matter of providing infrastructure. Once you start [providing]connectivity, naturally that will attract investments,” Dominguez was quoted as saying during their meeting.
When Fox asked how the UK government could assist the Philippines, Dominguez told him the UK could help the country catch up with its Southeast Asian neighbors in investing heavily in infrastructure, according to the statement.
Fox was informed that the government plans to develop a second international airport, build high-speed trains between Manila and Clark in Pampanga and possibly connect it to a commuter rail system in the South, along with improving Luzon’s ports to help decongest Metro Manila and encourage investments in the countryside.
For regions highly dependent on agriculture, the government will improve existing irrigation systems and build
new ones, among other measures to boost farm productivity, Dominguez said.
In response, Fox told Dominguez that the Philippines could look into UK’s £4.5-billion export-import facility to help source funds for the Duterte Administration’s unprecedented public investment program.
“We hope that you can tap this rather undertapped resource,” Fox was quoted as saying.
Fox was referring to the UK Export Finance (UKEF) – the operating name for its Export Credits Guarantee Department (ECGD) – the export credit agency and a ministerial department of the UK government.
The UK government had doubled the UKEF’s capacity to support trade with the Philippines to £4.5 billion from £2.25 billion.
The DoF said Dominguez welcomed Fox’s offer and said that even as the Philippine government seeks to tap foreign funding sources, it also set on implementing a comprehensive tax reform program to generate revenues internally for its infrastructure buildup.
The government is targeting to spend P847 billion this year on infrastructure projects to be undertaken simultaneously in all regions across the country, including small, medium and large-scale ventures.
For the entire duration of Duterte’s six-year term until 2022, the government intends to spend P8.4 trillion on infrastructure.
Fox said the UK is “keen on establishing its footprint” in the Philippines’ services sector and in exporting its education technologies.
“We have opportunities in life sciences, accounting, banking, the medical sector and education,” Fox said.
In the meeting, the officials also discussed expanding trade and investments between the two countries and expanding British exports to the world via the UK’s new online trade portal, Great.gov.uk.
Also present in the meeting were British Ambassador to the Philippines Asif Ahmad; Director for Trade and Investment of the British Embassy Mike Moon; the British Embassy’s Head of Inward Investment Aaron Chan and other embassy officials.
Total Philippine exports to the UK in 2016 were valued at $476 million, while imports from the UK reached $480 million in the period.