The government can pay its $62-million loan for the Chico River Pump Irrigation project but also expects China to comply with the provisions of the agreement, Finance officials said yesterday.
Finance Undersecretary Bayani Agabin said the country has never reneged on obligations “even during the most difficult times,” citing it has always been a responsible borrower.
The assurance was made to dispel concerns that the country might end up losing some assets to Beijing if it cannot pay its obligations under the Chico River deal.
“May probisyon tayo sa batas, it’s PD 1177, na awtomatikong naglalaan ng pambayad ng utang na nakapaloob po ito sa taunang General Appropriations Act. Meaning, all our indebtedness, it’s automatically appropriated in our budget,” Agabin said.
He challenged government critics to look and study the country’s credit history and consult with experts, as he dispelled concerns the country might fall into a debt trap. “If you will look at it, we’ve never had a history where we renege on our obligations, even during the most difficult times,” he said.
Finance Undersecretary Mark Dennis Joven said the government also relies on the “good faith” of China to comply with the provisions of the loan agreement. “We fully trust China to comply with a loan agreement which they signed, in the same way as they trust us to comply with a loan agreement which we signed,” Joven said.
“We’re very well aware of what is happening in the world and we’re fiscally responsible enough not to do something which will endanger the fiscal position of our country,” he added. (Genalyn Kabiling)