Announcement of Eleven Million Six Hundred Thousand US Dollars Loan to the Philippines on May 17, 1973

INTERNATIONAL BANK· FOR • RECONSTRUCTION AND DEVELOPMENT 1818 H STREET, N.W., WASHINGiON D. C. 20433 TELEPHOr,,E: EXECUTIVE 3-6360 Bank Press Release No. 73/25 Subject: $11.6 million loan to the Philippines May 17, 1973 for a fisheries· credit project. The World Bank today announced a loan of $11.6 million equivalent to help develop marine and inland fisheries in the Philippines. The project will support the Government's program to increase fish production for donestic consumption, and is the first Bank Group operation in the Philippines exclusively for fisheries. Fisheries is an important economic activity in the Philippines, employing directly about 700,000 persons, constituting 5.5% of the total labor force. Fish production is estimated at one million tons a year, and domestic demand for sea products is growing rapidly. With over 7 ,ooo islands, the Philippine archipelago provides excellent access to fishing grounds. The coastline, with its .many estuaries, is ideal for brackish water fish farming. Under the project, credit will be provided through the Development Bank of. the Philippines (DBP) to individuals and companies over a four-year period. The loan funds will finance marine fisheries, including the construction of fishing vessels, ice-making facilities and slipways for vessel repair and maintenance, and the purchase of fish carriers and vessel equipment. Inland fisheries will also be developed by financing the c0nstruction, rehabilitation and improvement of fishponds. 'rhere is a oontinuing need to rehabilitate fishponds which . were damaged by the 1972 floods, mainly in the Central Luzon area. Also to be provided • are technical assistance in implementing the project, as well as assistance in conducting studies needed to prepare future proj.ects for fish marketing and smallholder fishponds. At full development, wi trdn eight ·years, the project is expected to increase fish production by about 48.,000 tons a year, equal to about .5% of present fish production, and valued at about $13.2 million. Besides benefi tting about 1,100 sub-borrowers and -L'---iir depondents, i.t will create., on a' yearly basis, about 2,400 permanent jobs for unski.... -~d and semi-skilled fishermen and labor and employ aoout 4., 000 unskilled labor during the four-year :i.nvestmen~ period. The project was prepared with the assistance of the Food and Agriculture Organization/ World Bank Cooperative Program. It is expected to spur the future developnent of fisheries by increasing knowledge of marit~? resources, demonstrating the value of improved operations, training extension staff, promoti'i.ng sound lending prac,tices and preparing two other projects in the fisheries sector. The total cost of the projec·jj is estimated at $18.5 million, of which $11.6 million will be covered by the Bank loan, and the remainder by DBP, the Government of the Philippines, and the sub-borrowers. Credit operations will be implemented by DBP's Fisheries Group. DBP, a wholly-owned Go-\remment institution, is the country 1 s most important source of finance· for agriculture and.industry. Through its extension services, the Bureau of Fisheries,, a Government agency under the Department of Agriculture, will assist with .technical appraisal .and will provide technical supervision and guidance to the sub-borrowers. . The Bank loan is being made to the R,l.1public of the Philippines for a term of 17 years, . i·p.cluding six years of grace, with interest at 7-i-% per annum. The Government will relend • p·--Jt~ proceeds. to DBP, and DBP will onlend the Bank funds, supplemented with it.s own ,; resources' to sub-borrowers. Two Japanese financial institutions, The Saitama Bank Ltd., Tokyo, and The Toyo Trust and Banking Co., Ltd., Tokyo, are participating in the Bank loan to the Philippines for a total amount of approximately $140,000 equivalent.  • May 17, 1973 TECHNICAL DATA PROJECT: Fisheries credit COUNTRY" Philippines TOTAL COST: $18. 5 million eaui valent. BANK FINANCING: $11.6 million equivalent, 17 years, 6 years of grace, 7~ interest per annum. OTHER FINANCING: Development Bank of the Philippines (DBP); Government of the Philippines; and sub-borrowers. IMPLEMENTING ORGANIZATION: Rizal, Philippines. Development Bank of t.he Phi~ippines, Makati, PROJECT DESCRIPTION: Provision of credit to individuals and companies ove,;r a 4-year period to develop: marine fisheries by financing the con- ., struction of fishing vessels, slipways, and ice-making facilities and the purchase of fish carriers and equipment; inland fisheries by financing the construction, rehabilitation and improvement of fish ponds.. The project also includes technical assistance to provide a marine specialist, a naval architect and an aquaculture extension expert, and assistance to help prepare a fi.sh marketing study and a smallholder fish pond project. PROCUREMENT: Fishing vessel hulls: local competitive bidding among pre-, qualj.fied shipyards~ Fishing vessel equipment: to be chosen by individual operators from qualified suppliers. Second-hand fish carriers: to be procured outside the Philippines by advertising vessel specifications :in potential suppliers countries. Turnkey contracts for slipways and ice-making facilities: international competitive bidding. Fish pond development: local labor and con- tractors approved by DBP. OONSULTANTS: DBP will obtdn the services of: a marine specialis·t and a naval arch! tect to assist DBP in the review of sub-loan applications and in the design ahd procurement of fishing vessels, fish carriers and equipment; local consultant,s to assist the beneficiaries to carry out inves.~ment projects for ice-making facilities and slipways; an aqua- •. culture extension expert to assist the Department of Agriculture in up- . grading its extension' services for inland fisheries and in training its extension staff and DBP 's appraisal staff_; and consultants to prepare a fish marketing study and a smallhqlder fishpond project.