DOF And JICA To Execute $1.5 Billion Pipeline Projects

The Department of Finance (DOF) is gearing up to execute approximately $1.5 billion worth of pipeline projects in collaboration with the Japan International Cooperation Agency (JICA) for the years 2024-2025.

With Japan's commitment amounting to $12.30 billion in net commitments (loans and grants), or 32.82% of total ODA as of December 2023, the collaboration holds substantial promise for future development initiatives. I Photo: Department of Finance Facebook

This significant development emerged from discussions between DOF Undersecretary Joven Balbosa and JICA’s Director General Hayakawa Yuho at the JICA Office in Washington, D.C.

During the meeting, Undersecretary Balbosa highlighted the robust partnership between the Philippine Government and JICA, acknowledging Japan as the country’s largest official development assistance (ODA) partner.

With Japan's commitment amounting to $12.30 billion in net commitments (loans and grants), or 32.82% of total ODA as of December 2023, the collaboration holds substantial promise for future development initiatives.

Building upon this partnership, the DOF and JICA have outlined plans to execute a pipeline commitment of approximately JPY 227.6 billion ($1.5 billion) from April 1, 2024, to March 31, 2025.

Additionally, an annual average pipeline of about JPY 249.2 billion ($1.6 billion) over the next five years from 2023 to 2027 is anticipated.

Discussions also revolved around the timeline and preparations necessary for signing loan agreements for projects concerning maritime safety, roads, and flood risk management, with targets set before the year's end.

In a move to diversify project portfolios, JICA revealed its expansion into sectors aligning with the Marcos, Jr. administration’s development objectives, such as agriculture, education, and health.

Moreover, the agency expressed readiness to bolster policy-based lending, intending to co-finance the Climate Change Action Program (CCAP), Subprogram 2, with the Asian Development Bank (ADB) and Agence Française de Développement (AFD).

The CCAP aims to bolster the Philippines’ efforts in implementing national climate policies, including its Nationally Determined Contribution (NDC), facilitating the transition toward a climate-resilient and low-carbon economy.

Furthermore, both parties delved into discussions on project implementation issues, emphasizing the importance of maintaining open dialogue and addressing any delays to enhance overall project management and minimize costs to the government.

Lastly, the DOF sought JICA’s assistance in attracting more private sector financing to support the administration’s development goals as the Philippines progresses toward upper-middle-income country (UMIC) status, signaling a gradual shift away from concessional financing.