Asian Development Bank approves another US$400 million loan for capital market development
MANILA – The Asian Development Bank (ADB) approved a US$400 million policy-based loan to support the Philippine government’s efforts to strengthen domestic capital markets and reach its development goals of high, sustained economic growth as well as poverty reduction.
In a statement released Tuesday afternoon, the ADB said the Support to Capital market-Generated Infrastructure Financing Program, subprogram 1 hopes to address key constraints that have limited the growth of domestic capital markets, particularly government and corporate bond markets. It also focuses on building a vibrant domestic institutional investor base that will become a sustainable source of long-tenor infrastructure finance. With the strengthening of the infrastructure finance, the capital market development program will support public infrastructure spending for the coming years.
The Duterte Administration’s centerpiece program, the “Build, Build, Build” infrasttr5ucture development program aspired to increase public spending on infrastructure towards7.0% of gross domestic product by 2022, from 5.5% in 2016 and an average of 2.8% in the last three decades.
ADB Vice President Ahmed M. Saeed said resilient and vibrant capital markets are key to achieving economic development, growth, and poverty reduction as part in the government’s long-term strategy AmBisyon2040.
“By developing domestic capital markets, funds are generated to support higher levels of long-term investments and sustainable quality job creation. The program approved today will support the Philippine government’s development goals, including its response to the COVID-19 pandemic,” Mr. Saeed added. (Melo M. Acuña)
Asian Development Bank Vice President Ahmed M. Saeed. (ADB File Photo/Flicker)