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A loan agreement between the Philippines and Korea has been signed, kicking off the Covid-19 vaccine program.

On Friday, the Philippines and Korea agreed to a USD100 million loan to help the Philippine government continue its statewide coronavirus disease 2019 (Covid-19) immunization program.

The Philippines’ Finance Secretary Carlos Dominguez III and the Export-Import Bank of Korea’s Economic Development Cooperation Fund (KEXIM-EDCFCountry )’s Chief Representative Jaejeong Moon signed an agreement for the second phase of the Program Loan for Covid-19 Emergency Response Program – Vaccination Program (PLCERP II). Kim Inchul, the Korean Ambassador to the Philippines, was present at the signing ceremony.

“This financial aid from Korea will go a long way toward assisting the Duterte administration in ramping up its mass vaccination effort against Covid-19, which is critical to our domestic economy’s strong recovery by 2022,” Dominguez added.

Kim expressed his delight at being a part of the “important” loan agreement signing ceremony.

“Through this arrangement, Korea will be able to contribute even more to the Philippine government’s arduous efforts to combat the pandemic and achieve early economic recovery,” he said, adding that Korea remains dedicated to assisting the Philippine government in the fight against the virus.

The PLCERP II will help “ensure financial sustainability and bridge the budgetary gap” in administering the Department of Health’s nationwide Covid-19 vaccination program, according to the Department of Finance’s International Finance Group (DOF-IFG).

The financing, according to the DOF-IFG, is intended to help with the continuing vaccination drive’s implementation, monitoring, and management.

In October of last year, Korea provided the government with a USD100 million loan for the first phase of the PLCERP, which aimed to develop systematic policy measures to address Covid-19’s public health issues in the Philippines.

In acknowledgment of the Philippines’ accomplishments and goals under the first phase of the loan program, which focused on seven policy actions, Korea extended the loan for PLCERP II.

These include developing a national policy or master plan for Covid-19 vaccination, assigning roles to major committees and/or organizations to speed up vaccine procurement and administration, profiling eligible populations and determining priority groups, and obtaining FDA-approved Covid-19 vaccines.

The Philippine government was also recognized for establishing an effective vaccine stock and logistics management system, allocating budget for vaccine procurement, and establishing guidelines to monitor any adverse effects and provide treatment and compensation for vaccines, according to the DOF-IFG.

The PLCERP II, like the first part of the loan, has a 30-year repayment duration with a 10-year grace period and a fixed interest rate of 1.5 percent.

Korea has extended a USD50 million loan to the Philippines-Korea Project Preparation Facility to bridge operational gaps in implementing projects under President Rodrigo Duterte’s signature “Build, Build, Build” infrastructure development program, in addition to providing funding support for the Philippines’ Covid-19 response.

Korea has also offered its experience and assistance in helping the Bureau of Internal Revenue set up an electronic invoicing system in order to better tax management.

As of 2020, it has pledged USD1.25 billion in Official Development Assistance loans to the Philippines.

Korea plans to increase its support to the Philippines to USD3 billion over the next five years under the KEXIM-EDCF.

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