MAR ROXAS DEFIES NOY ADMIN PREFERENCE FOR PPP FOR PORT, RAIL PROJECTS
MANILA, OCTOBER 11, 2011 (STANDARD) by Christine F. Herrera - ADMINISTRATION lawmakers on Sunday backed Transport Secretary Manuel Roxas II for choosing to use official development assistance to finance P565 billion worth of new port and rail projects, instead of the public-private partnership model pushed by President Benigno Aquino III.
"It looks like Secretary Roxas has repudiated the PPP preference of President Aquino..." ACT Teachers Rep. Antonio Tinio told the Manila Standard.
"President Aquino should drop PPP projects using private sector funds because these carry with them terms of 6-percent interest payable in five years compared to ODA loans at 4.5 percent."
House Assistant Majority Leader Eduardo Gullas of Cebu also favored Roxas' decision to draw on ODAs instead of relying on more expensive private sector capital.
"There is wisdom in tapping ODA funds, which are easier on the pocket compared to private equity or commercial borrowing. Government can generate real savings," Gullas said in a statement.
The President has made public-private partnership a centerpiece of his administration, but has not bid out a single project after 15 months.
Earlier, Budget Secretary Florencio Agad said PPP projects would still be more efficient even if their cost was higher.
Gullas last week took an opposing view.
"There is more than enough official aid around. In fact, previous administrations wasted a lot of money by not efficiently harnessing ODA funds," he said.
Roxas recently unveiled a five-year plan, using ODA funds, to develop key port and rail projects aimed at building up the country's public transport systems.
ODA refers to money from the official sector, mostly foreign governments and international agencies, mainly for the purpose of supporting the development and welfare of emerging countries.
By their very nature, Gullas said, ODA funds were extended at concessional terms.
In some cases, he said, if the aid was in the form of a loan, at least 25 percent of the money was offered as a gift or an outright grant, which he said could save a lot of money for the government.
Gullas said the Philippines now had 20 active bilateral ODA donors. its active multilateral ODA donors included the World Bank, Asian Development Bank and the European Union, he said.
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Chief News Editor: Sol Jose Vanzi
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