The Philippines and China exchanged documents for a RMB2.34 billion loan to finance the construction of a two-way, four-lane bridge connecting Davao City and the Island Garden City of Samal in Mindanao, the Department of Finance (DOF) said.
At approximately P17.39 billion (about $362 million), the loan for the Samal Island-Davao City Connector (SIDC) project is the first renminbi-denominated loan secured from China under the Duterte administration, the agency said.
The concessional loan will cover 90 percent of the financing requirements of the SIDC project’s design-and-build contract worth P19.32 billion,” the DOF added.
The agreements for the loan were signed last May 31.
The Department of Public Works and Highways, the main implementor of the project, entered into an agreement with China Road and Bridge Corp. for the construction of the 3.86-kilometer SIDC bridge which, once completed, will significantly cut travel time between Davao City and Samal Island, and reduce the dependency on ferry services.
The loan carries an interest rate of 2 percent per annum payable in 20 years, inclusive of a seven-year grace period.
