DBP allots P50B loan fund for PH maritime sector

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DBP allots P50B loan fund for PH maritime sector
The Development Bank of the Philippines will provide concessional loans at interest rates of as low as 5.5% and a term as long as 15 years help local shipping industry players and stakeholders undertake maritime-related projects under the Maritime Industry Plan. Image by fsHH from Pixabay
  • State bank will offer concessional loans for projects of local players under the country’s 10-Year Maritime Industry Development Plan (MIDP)
  • DBP formalizes partnership with Maritime Industry Authority in implementing MIDP program by signing a memorandum of agreement on June 21
  • MIDP programs seek to modernize the domestic fleet, develop maritime tourism shipping services, and set up a maritime hub with shipbuilding, repair, and logistics

Development Bank of the Philippines (DBP) has earmarked a P50-billion loan fund for the country’s 10-Year Maritime Industry Development Plan (MIDP) that it will implement in partnership with the Maritime Industry Authority (Marina).

DBP, as a government financial institution (GFI), will provide concessional loans at interest rates of as low as 5.5% and a term as long as 15 years help local shipping industry players and stakeholders undertake maritime-related projects under the MIDP.

The two government entities formalized their partnership by signing on June 21 a memorandum of agreement at the opening of the 7th Philmarine 2022, a three-day maritime and shipbuilding industry exhibition  at the SMX Convention Center.

Signing the MOA were DBP president and chief executive Emmanuel G. Herbosa and Marina Deputy Administrator for Operations Nannette Dinopol.

“The Marina forged this MOA to collaborate with DBP to develop and implement comprehensive financing programs to assist shipyards, shipping companies, and cooperatives on maritime-related investments as well as to provide necessary loan financing and credit facilities, including other bank products and services, in line with the strategic programs of the MIDP,” Dinopol said after the signing.

The MOA tasks the GFI with providing an “attractive financing program, training, and consultancy services that will eventually promote a progressive and sustainable maritime industry.”

At the height of the pandemic, Dinopol recalled, Marina continued to address shipping industry hurdles “such as an aging fleet and the lack of incentives and attractive financing schemes for industry stakeholders.”

Dinopol specifically referred to the MIDP’s Program No. 1, which deals with the modernization of the domestic fleet; Program No. 2, which addresses the development of shipping services for maritime tourism; and Program No. 5, which involves development of a maritime hub that will include shipbuilding and ship repair, as well as logistics.

DBP has many years of experience in lending to local shipyards, port developers, and shipowners seeking funding for acquisition of roll-on/roll-off passenger vessels for the inter-island trade, especially for missionary routes, Herbosa said.

He said this makes DBP familiar with some programs under the MIDP, which Marina developed.

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