THE government may end up borrowing to set up the Philippine Infrastructure Corp., the Department of Finance admitted on Wednesday.
This came a day after a former official of the National Economic and Development Authority criticized the Medium-Term Philippine Development Plan as “undoable and unrealistic.”
Professor Solita C. Monsod had warned that the establishment of more government-owned or -controlled corporations, including the PIC, might further expand the national government’s assumed liabilities.
Finance Secretary Juanita D. Amatong told reporters on Wednesday that around half of the corporation’s P20-billion funding requirements will come from proceeds of the Economic Recovery through Agricultural Productivity bonds.
“Don’t they realize that we need infrastructure? How can we develop infrastructure if we don’t establish the PIC?” Amatong said.
The other half of its requirements, according to Finance Undersecretary Eric O. Recto, may be secured through borrowings.
“But these are borrowings which we hope would be nonrecourse borrowings, almost like project financing or asset-based financing,” he explained.
He said the PIC would not be an added burden to the consolidated public sector deficit, adding that it would not aggravate the country’s debt situation.
Unlike government agencies, Recto added, the corporation would not rely on national government revenues to finance its operations.
–Armie Margaret Lee