RTTNews - Monday, the Asian Development Bank approved a $500 million short-term fiscal stimulus loan for the Philippines, the first loan approval from the bank's $3 billion Countercyclical Support Facility or CSF.
This loan is critical for the Philippine government to stimulate the economic recovery, protect its social spending and poverty reduction programs, and continue with its longer-term development objectives in 2009, said Arjun Thapan, Director General of ADB's Southeast Asia Department.
It is designed to maintain momentum of the country's key development efforts by expanding the fiscal space at a challenging time for the global economy.
The loan will have a five-year repayment term, with a three-year grace period, and will cost around 200 basis points over ADB's financing cost, pricing that reflects spreads prior to the onset of the global economic crisis.
The CSF, established in June 2009, supports ADB's developing member countries to counter the global economic crisis. Access to the CSF are restricted to those developing member countries, which are adversely affected by the global economic crisis and must demonstrate sound macroeconomic policies. Those countries must have a countercyclical program in place.
Besides the Philippines, Bangladesh, Indonesia, Vietnam, Kazakhstan, Pakistan and Sri Lanka have requested for CSF allocations, the ADB said.
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