PRESIDENT Arroyo has approved the Philippine Ports Authority (PPA) plan to float P2 billion in bonds after the May elections, according to PPA general manager Atty. Oscar Sevilla.
PPA has been planning the bond floatation since two years ago to finance major port projects.
Sevilla said the Development Bank of the Philippines will underwrite the P1 billion and First Metro Investment Corp., a subsidiary of Metrobank, the other P1 billion.
The bonds may be floated by July and will carry a 7% interest rate with a maturity of seven years.
Proceeds will go to six ports that the PPA wants to be at par with international standards before President Arroyo steps down in 2010. These are the Iloilo Container Port Complex, the expansion of a back-up area for the new wharf in Ozamis port, the back-up area for the newly constructed wharf at the Cagayan de Oro port, the Sasa Wharf port expansion, the phase II of the wharf expansion at the Zamboanga Port, and the General Santos City port expansion.
The Department of Finance earlier this year asked PPA to delay the floatation as it may need government guarantee.
PPA said this was not necessary since it contributes to the national government’s sinking fund, a sum set aside periodically from the income of a government agency and allowed to accumulate for use to retire a debt.