Loans accounted for 94.6 percent of multilateral official development assistance and only 5.4 percent were in the form of grants. On the other hand, 78.4 percent of bilateral aid was in the form of loans, only 21.6 percent was grants. Japan's share of total bilateral loans at 85.4 percent is greater than its share of total bilateral official development assistance.
The share of infrastructure support funds rose from 41.9 percent to 60.1 percent between the two periods. In terms of subsectors, transportation has the largest allocation at 26.5 percent, followed by agriculture at 20.2 percent, as shown in Table 5 below. Notable laggards are agricultural reforms (1.8 percent), science and technology (0.16 percent), cooperatives (0.0004 percent), housing, social security and community development (0.15 percent) and social infrastructure (0.0004 percent) .11 The absence of allocations for housing in the official NEDA reports is surprising, as the World Bank is known for providing support to government housing programs.
Loans provided by the ADB through the bank's Ordinary Capital Resources (OCR) are set at 6.7 percent for dollar loans and 5.5 percent for multi-currency loans (pool-based as with WB loans).
Japan earned from 75 cents to
Tied loans require the recipient country to obtain most, if not all, of the technical assistance, equipment or supplies from the donor country. Many years ago, the Deputy Director General of NEDA revealed that Japan earned 75 to 95 cents for every dollar of aid it gave in the form of goods and services that the recipient country bought from the donor country in connection with aid projects.
Availability levels indicate a country's absorptive capacity in relation to contracted ODA funds. Of the US$8.4 billion in unspent funds, US$7.9 billion (or 95 percent) went to the World Bank, ADB and JBIC alone. Its original completion schedule of December 1999 was revised to December 2000, but it was reported that it was still not complete by the new deadline.
The zero availability rate of the Philippine National Oil Company (PNOC)-JBIC Northern Negros Geotherm Project, as shown in Table 8 below, was attributed by NEDA to (among other things) the “failure to enter the portion of the geothermal services contract area falling within the area'. Kanlaon Natural Park. Critics of the project pointed out that the PNOC could well dig its resources outside the protected area. Mount Kanlaon Park is “one of the few remaining national parks in the country and is home to.
Cost overruns were reported for 14 projects with increased costs ranging from 12 percent to 202 percent of original estimates. According to the 1994 Review, the inability of the government to fully support ODA projects in its regular budget caused a shortfall of P57 billion or 44 percent of the required amount. With half of the project time already over, 90 percent of the funds remain unused.
In the General Appropriations Act of 1999, only PP 34 billion was allocated for current projects with foreign aid, less than the requested PP 38 billion. The Build-Operate-Transfer (BOT) scheme is one form of this public-private partnership. These debts (either settled or transferred to the state) thus become "contingent liabilities" of the state and become part of the consolidated public sector budget.
Of the PhP217 billion in contingent liabilities for 2001, PhP12.03 billion (5.5 percent) became actual debt that the government must pay. From December 2000, the Bank withheld release of the second and third installments pending the government's compliance with the above conditions.
The loans were contingent on Congress passing a controversial and unpopular Omnibus Power Bill that privatized the National Power Corporation and eventually transferred ownership of power generation to the private sector.36 An ADB loan that requires close monitoring by civil society groups is $175 million Grains Sector Development Program (approved in April 2000), intended to restructure the cereal sector to make it more "market-based, productive and internationally competitive." The World Bank's "Sectoral Adaptation of Environment and Natural Resources" program loan resulted in the passage of the National Integrated Protected Areas (NIPAS) Act of 1992, which mandated the decentralization of monitoring and enforcement of biodiversity conservation in designated protected areas throughout the country. Country. However, implementation mechanisms leave much to be desired as the DENR continues to dominate the process.
The NIP AS Act should also be harmonized with other existing laws such as the Indigenous People's Rights Act (IPRA). In 1989, the Senate Blue Ribbon Committee complained about "excessive and unnecessary fees" paid to foreign consultants by foreign-financed projects.37 The committee denounced the charging of foreign consultancy fees for services well within the expertise of the Filipinos and it was imposed. How much things have changed in the consulting game since then remains to be seen, but provisions in recent legislation are important to note.
To develop/enhance a pool of Filipino experts and managers, the role of technology transfer in the implementation of development projects will be ensured. To effect technology transfer to local firms/individuals, foreign consulting and/or construction firms wishing to participate in development projects in the Philippines will be required to link up with local firms and/or be required to engage Filipinos in carrying out the projects they have chosen to undertake. Such preference will not adversely affect the project and will meet the minimum standards/specifications required by it.
The above is reiterated by the "Implementing Rules and Regulations on the Procurement of Consulting Services for Public Projects" as approved by the NEDA Board in September. However, in the event that the Filipino consultants do not have the sufficient expertise and capacity to provide the services required under the project, foreign consultants may be hired, provided that for the sake of technology. An indicator of the state of the consulting issue for the Asian region as a whole is that several Japanese firms ended up as major consultants for ADB projects from Twelve of these consultancies were awarded lucrative contracts totaling US$60 million.
Social unrest sometimes
Shortly after the downfall of Marcos, thousands of pages of documents handed over to the Presidential Commission on Good Government (PCGG) by US customs authorities revealed the extent of corruption that accompanied the disbursement of Japanese ODA funds during the Marcos era -regime.41 The documents exposed a complicated web of corruption that involved the payment of large sums to Marcos and his cronies in the form of rebates or commissions for facilitating the implementation of yen loan projects. VOLUME VII NUMBER 1 (January- June 2003) 49. Of the four Southeast Asian countries compared, Thailand appears to have benefited the most from ODA, followed by Indonesia. It would appear that the higher figures in this category attributed to ODA may simply be the result of the tied aid (both loans and grants) that Japan is notorious for.
The geographic distribution of ODA should be redirected away from richer areas to poorer regions of the Philippines. In 1986, a group of UP School of Economics faculty members determined that "most projects financed by foreign loans were unproductive" in that many were "not well chosen or perhaps chosen to finance. Capital flight through project overpricing.”46 Economics professors also complained that “many private sector projects relied on government financial institutions for foreign loans and guarantees.” Failure to implement these changes will certainly a serious reconsideration of the necessity and importance of ODA to the overall economic and human development of the Philippines is in order.
11 There appears to be a misplacement of the category 'social infrastructure', which (however insignificant it may be) should probably be placed under the category 'human development'. The one sector that Japanese companies seem to be shying away from is the information technology sector, given the current downturn in IT stocks and sales, and is therefore seen as a 'new and risky investment'. Outside of IT, “Japanese companies play a proactive and important role in bringing ODA to the recipient country's doorstep.” However, exceptions were noted during the Marcos regime when Imelda Marcos' home province, Leyte in the Visayas, "received a disproportionate share, 16 percent of the total (excluding commodity loans).
This was more than the project loans going to the Metro Manila region proper, which received only 9 percent of the total. "Two other favored provinces during the Marcos administration were Cagayan (home province of then Defense Secretary Juan Ponce Enrile, and llocos Norte). Marcos' own home province). 34;These three areas alone accounted for almost a third (27 percent) of total OECF-financed projects during the Marcos period." The New Miyazawa Fund, which included the restructuring of the Philippine energy sector The plan was funded, was set up in 1997 with a total amount of US$30 billion and was intended to "to support the stabilization of the financial sector and the economic recovery of the countries most affected by the Asian crisis" (Saito and Ishida, 2001).
Sixteen of the country's top economists participated in the preparation of this 2-volume report containing proposals on how the Philippine economy could recover from the devastation of the Marcos years. Viterbo-Quimbo, Victoria T., "Philippine-} a pan Economic Cooperation in the 21st Century," Paper presented at the PHILAJAMES Roundtable Discussion, September 1, 2001, Asian Center, University of the Philippines.
