MANILA - Socioeconomic Planning Secretary Ernesto Pernia on Thursday said the Philippines will not fall into a debt trap by accepting Chinese loans to finance the massive infrastructure projects of the Duterte administration.
Speaking to the media during Thursday's regular briefing in Malacañang, Pernia said that the Philippine government has yet to sign any loan agreement with China.
"We certainly are going to be very careful with our dealings in terms of project financing from the Chinese government," Pernia assured.
The secretary said a two-fold mechanism has been put in place to vet Chinese companies who would be involved in the projects.
"First on the China side, we have a clearing mechanism. We want the Chinese side to certify to us that the companies, private or state-owned enterprises that will be involved in projects, will be truly competent and with impeccable integrity. That's on the Chinese side. So they can submit three names," Pernia explained.
"And on the Philippine side, we also have a clearing mechanism to seek --- to pick one of the three recommendees from the Chinese side. So that is the best we can do to ensure that we are not going to get into problems."
The Philippine government plans to invest at least P8.2 trillion for its massive infrastructure push. Pernia said this will be financed through an optimal mix of the general appropriations act, official development assistance and private sector funding.
Pernia reported that during the Duterte administration's first year, the NEDA Board approved 28 infrastructure projects worth about 786 billion pesos.
These projects, according to Pernia support the administration's thrust to support economic growth through interconnectivity of regions as well as the traffic alleviation in Metro Manila.
Among these projects are the 102-kilometer commuter railway from Tagum City in Davao del Norte to Digos City in Davao del Sur; the expansion of the Clark International Airport; and the construction of a commuter line and an express train between Manila and Clark.
Also approved is the construction of the Cebu International Container Port, which Pernia said "will modernize port operations in Cebu and relocate the rather congested current port in Cebu to Consolacion which is outside the city center."