DBP extends technical assistance loans for Ro/Ro terminal

The Development Bank of the Philippines (DBP) will provide loans that would ultimately lead to the development of a road Ro/Ro (roll-on/roll-off) terminal system known as the Northeastern Luzon Pacific Coastal Service (NLPCS).

The coastal service is one of many routes identified for financing under the Sustainable Logistics Development Program (SLDP), a DBP facility that seeks to spur greater economic activity by improving the country’s basic infrastructure.

That means establishing a grains "highway", a road-to-Ro Ro terminal system, and a cold chain.

"The improved infrastructure should lead to better movement of commodities through the introduction of modern storage handling and transport system under proper quality control management," the government financial institution (GFI) said in a statement.

Recently, DBP signed an agreement with the local government units (LGUs) of Cagayan, Isabela and Aurora.

Targeted for implementation by early 2004, the project involves the development of seaports as well as the improvement of shipping operators in the Northeastern Luzon coastal areas. It likewise aims to provide farmers and fishermen in isolated municipalities and barangays in these areas with means of transporting agricultural products.

"In turn, the infrastructure would make basic commodities, farm inputs, and social services accessible to these communities," the DBP said.

The GFI has funds amounting to at least P70 billion for its three priority lending areas including the small and medium enterprises (SME), and major infrastructure programs like transportation and power. More than half would be allocated for SME lending.

Other areas for lending are for environment conservation, and infrastructure activities related to the transport and storage of the farm produce such as processing and marketing centers, aggregating centers, reefer transportation equipment, bulk terminals, handling and transport equipment for both land and sea.

The amount allocated for the NLPCS will largely depend on the progress of the various studies being undertaken.

The DBP will be providing financial advisory services and technical assistance to the three LGUs in preparation of technical feasibility stdues and design of ports and vessels.

"The bank can also provide loans for qualified projects of the LGUs," it added. The SLDP program should result in the drastic reduction of the price of basic commodities.

DBP chairman Vitaliano N. Nañagas II in an earlier presentation said that the bank could provide the medium- and long-term development loans to the private sector and local government units (LGUs) for various projects such as Ro/Ro vessels, Ro/Ro ports, processing and marketing centers, aggregating centers, reefer transport equipment, and bulk terminals, handling and transport equipment.

"Based on a study undertaken by United States Agency for International Development (USAID), waste and spoilage in transporting fruits and vegetables from farmlands to end-users is about 40 percent or equivalent to P30-billion annually," the DBP chairman said. "In the case of transporting corn, spoilage loss is about 20 percent of national production amounting to P4.5-billion annually."