- The Japan Bank for International Cooperation (JBIC; Governor: Akira Kondoh) signed on August 3 a general agreement for establishing a credit line (a facility based on untied loans) in the amount of up to USD50 million (of which JBIC’s portion is USD25 million) with BDO Unibank, Inc. (BDO), a Philippine entity. The credit line is cofinanced with Japanese private financial institutions, with JBIC providing a partial guarantee for the cofinanced portion.
- This credit line is intended to finance, under the GREEN operations,*1 necessary funds for environment-related projects which contribute to reducing greenhouse gas (GHG) emissions, with a focus on renewable energy projects in the Philippines. This will be the first time for JBIC to provide GREEN finance to the Philippines.
- The Philippine government submitted the Intended Nationally Determined Contributions (INDCs) in October 2015 ahead of the COP21 agreement, in light of its vulnerability to climate changes and natural disasters as an archipelago country. With these pledges, the Philippines government has been taking vigorous steps to implement measures to cope with climate change, which include setting the goal of reducing GHG emissions by 70% by 2030 relative to its BAU (Business As Usual) scenario of 2000-2030. This credit line is expected to assist the reduction of GHG emissions and promotion of the government’s environmental policy while propagating advanced Japanese environmental technologies which have received high international recognition. This is also in line with an initiative announced by the Japanese government in December 2015, “Actions for Cool Earth: ACE2.0.”
- JBIC and BDO have been building a cooperative relationship, such as signing a memorandum of understanding (MOU)*2 in March 2013 for the development and the strengthening of frameworks to support business expansion into the Philippines by Japanese mid-tier enterprises and small and medium-sized enterprises (SMEs) through Japanese regional financial institutions. This credit line is intended to further strengthen such partnership between the two organizations, with a target on the environmental sector.
- As Japan’s policy-based financial institution, JBIC will continue to support global environmental conservation efforts in cooperation with local banks, by drawing on its various financial facilities and schemes for structuring projects, and performing its risk-assuming functions.