Philippines pays Chinese loan to its shelved rail project

2012-10-09 07:02:43 GMT2012-10-09 15:02:43(Beijing Time)  SINA.com

By Mei Jingya, Sina English

Philippine Finance Secretary Cesar Purisima said Monday that Manila is committed to pay the Chinese loan to its controversial North Luzon Railways Corp. (North Rail) project in four tranches, with the principal and interest paid on Sept. 21, according to an ABS-CBN report.

Purisima said the Finance department has successfully negotiated with the Export-Import Bank of China (ChinaExim Bank) officials about the payment of the disbursed amount in four tranches instead of lump sum amount.

“We are committed to pay the disbursed amount of $185.15 million to the Eximbank of China including interest due under revised negotiated terms of four equal installments within 2012 and 2014. Currently, we have already paid the principal and interest due on Sept. 21, 2012 amounting to $46.11 million representing first payment,” Purisima said.

The North Rail project was initiated by the Arroyo government in 304. Last year, the Aquino government shelved the North Rail project to renegotiate the terms of the contract with the Chinese.

In late September, Philippine media reported China has asked the Philippines to immediately reimburse the loan for the scrapped North Rail contract.

The Philippine Finance Secretary Cesar Purisima told The STAR yesterday that non-payment of the North Rail loan or any other government loan would have adverse impact on the country’s credit status.

Related news:

Philippines asked to pay Chinese loan to its rail project