Q1: Are only a limited number
of Filipinos benefiting from Japanese ODA?
A: No, Japan assistance is spread
over various fields and benefits a large number of Filipinos.
It accounts for 33% of all ODA received by the Philippines in 2008 (Source: DAC).
Japan has been the top donor country to the Philippines
for many years. Despite its current economic difficulties,
Japan will continue to support the Philippines, one of
the most important and friendly countries to Japan. Japanese assistance to the Philippines has also been funneled
through multilateral donors such as the World Bank, the
Asian Development Bank (ADB), and various UN agencies.
With the cumulative amount of Japan ODA to the Philippines
totaling US$20.560 billion (1967-2008), the Philippines
ranks as the fourth largest recipient, next to Indonesia, China and India.
Then, how many Filipinos are actually aware that Japanese
ODA has been benefiting their lives? While Japan is known
as a funding source for big projects such as NAIA Terminal
2 and the Second Mandaue-Mactan bridge, many people including
those who directly benefited from Japan assistance, are
sometimes unaware of Japan support in a large number of the projects.
Through the decades, Japanese ODA has been contributing
to Philippine’s development efforts in many fields,
including irrigation, flood control, education, health
care, earthquake detection, rural road network construction/improvement,
water supply, and livelihood programs. For example, the
2,100-km Philippines-Japan Friendship Highway (Pan Philippine
Highway) was constructed under Japanese ODA loan. For
sure, you can find Japan-supported projects all over the Philippines, as well as
Japanese experts and Japanese volunteers.
Q2: Is Japanese ODA used
for promoting the export of Japanese goods and services?
A: No. 95% of Japanese ODA is open
to non–Japanese goods and services.
With regard to the procurement system, the types of
ODA can be internationally categorized into tied and
untied. Untied ODA means that procurement of goods and
services necessary for ODA projects is open to those of
any country. In 2007, the ratio of Japan untied ODA worldwide
is 95.1%, which shows that most of Japanese ODA projects
are not limited to using Japanese goods and services alone.
Some people still misunderstand, if not misinformed,
that Japanese ODA is used in export promotion and only
profits Japanese companies. That was actually once true,
from the 1960s up to the mid-80s, when Japan ODA financing
contributed to promote its exports of businesses. During
this period, most projects were tied to Japan, but things
have since changed. It is therefore unfortunate that some
people still confuse the old practice as still existing.
Q3: Is Japanese ODA ill-balanced
toward loans?
A: No. Loans, grants, and technical
assistance are well-balanced to meet various needs. Loans
are suitable for promoting self-help development efforts.
Japan provides assistance in three
forms: loans, grants, and technical assistance. The breakdown
of Japanese ODA in 2008 is as follows: US $7050.81 million
in loans, US $4780.69 million in grants, US $3057.82 million
technical assistance (on a gross disbursement basis).
A large portion of Japanese ODA, especially that extended
to middle-level developing countries, has been in the
form of loans because Japan firmly believes that ODA should
be used to support the self-help efforts of developing
countries. ODA loans, with their repayment obligations,
are more effective in facilitating development in middle-level
developing countries, making the recipient governments
more carefully appraise how such loans are effectively
and efficiently allocated for specific projects.
Furthermore, loans make it possible for recipient governments
to invest in large-scale socio-economic infrastructure
as well as respond to the vast fund demands of societies
that grants cannot serve. In fact, in the process of its
own national reconstruction after World War II, Japan
borrowed money from the World Bank to construct large-scale
infrastructure.
Loan conditions under Japanese ODA to all developing
countries in the world are extremely concessional. On
the average, in 2000, the interest rate was 1.34% and
the term of repayment was 33 years and two (2) months,
including a grace period of nine (9) years and ten (10)
months. These conditions are quite favorable as compared
to loans from other multilateral donors. Because Japanese
ODA loans are not administered on a self-paying basis,
their very concessional terms are afforded by their built-in
grant component, which is actually borne by the Japan
taxpayers.
On the other hand, Japan caters to poor areas and social
projects mainly through grants and technical assistance.
In the health sector, for example, the upgrading and expansion
of medical and health facilities and the training of personnel
are among the priority areas of its grant and technical
assistance programs.
Q4: Does Japanese ODA contradict
the needs of the Philippines?
A: No. The Philippine government
alone proposes ODA projects on behalf of the Filipino people.
Japan highly respects the self-help efforts of every
developing country. Thus, Japanese ODA, in principle,
is extended upon the request of the governments of developing
countries. In the case of the Philippines, government
agencies and LGUs submit project proposals to NEDA for
its evaluation. After the respective approval by NEDA
and the ICC, the Philippine government makes an official
request for its short-listed priority projects to the
Japanese government, which then carefully appraises those
projects and approves those that are most necessary and
matured.
Appropriate utilization of ODA is most important not
only for the Philippines but also for Japan, since ODA
funds originally come from Japan taxpayers.
In order to implement its ODA more effectively and efficiently,
the Japanese Embassy closely coordinates policies and programs with the Japan International Cooperation Agency
(JICA), the development assistance implementing agencies operating under the Government of Japan.
Q5: Is Mindanao the least
priority region of Japan ODA?
A:
No. Assistance for Mindanao is one of the three main pillars of Japan's ODA for the Philippines. Japan is firmly committed to alleviating poverty and consolidating peace in Mindanao through ODA.
Under Japan's country assistance program for the Philippines, the Government of Japan places assistance for Mindanao as one of the three pillars. To pursue the goal of peace and stability in Mindanao, the Government of Japan launched J-BIRD ( Japan- Bangsamoro Initiatives for Reconstruction and Development) in December 2006, which is designed to contribute to the peace process and development in the Conflict-Affected Areas in Mindanao (CAAM) and the surrounding areas in the ARMM (Autonomous Region in Muslim Mindanao).
The objective of J-BIRD is to enable the people and the communities in the target areas to enjoy the “dividends of peace” through the Japanese ODA on the basis of “Human Security” principles. As of now, the total amount of the J-BIRD assistance is approximately Y11.23B (PHP5.92B).
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