PHL end-June ODA loans a bit down on low capacity to absorb

Official Development Assistance (ODA) loans extended to the Philippines dropped to $8.31 billion as of end-June, down $0.53 billion year-on-year, according to the National Economic and Development Authority (NEDA). The ODA money as of end-June funded 68 projects worth a total of $7.27 billion and seven programs worth $1.04 billion, NEDA said. Of these, only five were closed during the period, while 66 are ongoing and the remaining four are yet to be implemented. The drop in ODA loans is due to a lower level of absorptive capacity for the period, NEDA said, noting lower rates of disbursements and availments compared to the first semester of 2010. According to the NEDA-Project Monitoring Staff (PMS), procurement and financial issues coupled with the suspension of contract and sharing schemes between the national and local governments contributed to the decline in disbursement rates. “The substantial decrease in the disbursement performance may be attributed to the low financial performance of some China loans and other sources-assisted projects," the NEDA-PMS report said. Stalled projects Some of these stalled projects include the first phase of the Northrail Project worth $400 million, the $26.6-million second Cordillera Highland Agricultural Resource Management (CHARM) Project; and the $9.72-million Local Government Unit Investment Program II. “The North Rail Project only disbursed $16.69 million out of its $180.59 million target for the year due to contract suspension issues while the last two cited projects did not make any disbursements yet in 2011," according to the report. The Japan International Cooperation Agency was the Philippines’ top source of ODA loans accounting for 31.69 percent, followed by the World Bank (23.75 percent), and China (13.73 percent). The Asian Development Bank accounted for 8.77 percent of the total loans, while Austria, the Organization of Petroleum Exporting Countries, Saudi Arabia, Spain and the United Kingdom were responsible for 22.06 percent. — JMT/VS, GMA News