Vol. XXII, No. 191-A [ BusinessWorld Online ]’
Saturday, May 2, 2009 | MANILA, PHILIPPINES
The Bangko Sentral ng Pilipinas (BSP) has approved a $200-million loan by the government to finance enhancements in the inter-island ferry chain called Strong Republic Nautical Highway.
In its weekly meeting on Thursday, the central bank said it had approved in principle a $195.18-million loan by the state from European banking giant BNP Paribas in Italy, which will finance the greater maritime access ports project of the Department of Transportation and Communications (DoTC).
"This involves the construction of 70 RORO (roll-on, roll-off) ports to be located nationwide, and will provide water transportation infrastructure to complement the development of the Strong Republic Nautical Highway," the regulator said.
The loan is in the form of a buyer’s credit facility and commercial loan facility, both with floating interest rates.
The buyer’s facility will have a maturity of 12 and a half years, inclusive of two-year grace period, while the commercial credit will mature in four and a half years with one-year grace period.
The buyer’s facility will follow the Euro Commercial Interest Reference Rate (CIRR), plus a 0.75%-point margin. The CIRR is a minimum interest rates for officially supported export credits.
The commercial credit facility rates, meanwhile, will track the six-month London Interbank Offer Rate, or LIBOR, plus 370 basis points.
The Strong Republic Nautical Highway, considered a major project of the administration, is a series of integrated highway segments and ferry routes.
The 919-kilometer network links the three island group — Luzon, Visayas, Mindanao — by land and water transportation. — Paolo Luis G. Montecillo
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