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Tuesday, June 09, 2009


Changes in the Logistics Infrastructure Assistance Facility (LINAF), THE Puerto Princesa Airport Development Project as well as the cost increase and 14-month extension of the Japan International Cooperation Agency (JICA)-assisted Mindanao Sustainable Settlement Area Development Project (MINSSAD) were recently approved by the National Economic and Development Authority (NEDA) Investment Coordination Committee–Cabinet Committee (IC-CC) during its third meeting for the year.

The LINAF has already been confirmed by the NEDA Board in 2005 but has been reverted back to the ICC due to proposed changes after an appraisal by JICA.

The cost of its Technical Assistance (TA) component is proposed to be increased from PhP80 million to PhP160 million while the local counterpart, from PhP4 million to PhP5.4 million. This resulted in a 7.18-percent increase in the total project cost from PhP20.12 million to PhP21.56 million.

The project's title is also proposed to be changed to Logistics Infrastructure Development Project.

Other changes are the exclusion of stand-alone power projects among the eligible projects under the facility; possible inclusion of national government agencies as eligible sub-borrowers as cleared by the Department of Finance; and the use of "Quality- and Cost-Based Selection" method under the new JICA guidelines.

The LINAF aims to improve the country's infrastructure facilities and logistics system by providing mid and long-term financing to private companies, local government units (LGUs), government-owned and controlled corporations (GOCCs), cooperatives, and national government agencies (NGAs). The Facility also intends to finance the Technical Assistance (TA) need of the Development Bank of the Philippines (DBP) ─ its proponent institution ─ as well as private financial institutions (PFIs).

Meanwhile, the Board also approved the PhP4.36 billion Puerto Princesa Airport Development Project which involves the improvement of the airport to comply with international standards. The project also aims to revitalize the transport and trade linkages under the Brunei Darussalam, Indonesia, Malaysia, and the Philippines-East ASEAN Growth Area (BIMP-EAGA).

About 78 percent or PhP3.4 billion of the total project cost will be financed through Korean Economic Development Cooperation Fund (EDCF) loan while the remaining 22 percent or PhP970 million will be the Philippine government counterpart funding.

This project will be implemented in July this year and is expected to be complete by 2012.  

The ICC likewise approved the proposed cost increase and 14-month extension of the MINSSAD project.

The Department of Agrarian Reform (DAR) proposed an increase in project cost from PhP3.102 billion to PhP3.177 billion and its project completion date is proposed to be extended from June 2008 to August 2009. The project was originally scheduled for implementation over six years.

The cost increase was due to the total allotment received by the project which exceeded the ICC-approved cost and DBM's Forward Obligational Authority (FOA) by PhP75.476 million.

The MINSSAD project involves the development of eight DAR settlement areas in Mindanao and has components such as rural infrastructure, agricultural and environmental development, procurement of equipment, and institutional development that include, among others the following:  construction/rehabilitation of irrigation facilities, farm-to-market roads, post-harvest facilities, school buildings, water supply, provision of appropriate training to agrarian reform beneficiaries.

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