Mizuho Bank Eyes Expanding Its Footprint in The Philippines

One of Japan’s largest commercial banks has expressed interest in expanding its footprint in the Philippines, particularly in the field of infrastructure where the Duterte administration has pledged to accelerate spending to create jobs and reduce poverty.

In a meeting with Finance Secretary Carlos Dominguez III, Nobuhide Hayashi, the President and CEO of Mizuho Bank, Ltd. said the recent state visit of President Rodrigo Duterte to Japan was an important development in the bilateral relations between Japan and the Philippines that “sent positive signals” to Japanese investors.

“We want to expand our business here, and we ask for your support,” Mr. Hayashi said during the meeting. His comment was in response to Dominguez’s explanation of the Duterte administration’s three priority goals which are: reducing poverty, promoting and developing a society that is law-abiding and ensuring that the country is at peace with itself and with its neighbours. Dominguez said that in implementing this goal, the government has “been quite successful, especially in making people safer.”

The finance chief also urged Mr. Hayashi to focus the Bank’s efforts to infrastructure, an area where the government plans to invest heavily to fill the gap left behind by previous administrations. Mr. Hayashi responded that Mizuho Bank is “very interested in infrastructure” as part of its plans of expanding its business and footprint here.

The Mizuho Bank President also said the Bank is organizing a seminar in Japan for investors interested in the Philippines. According to Mr. Hayashi, Mizuho Bank is aware of one of the Philippines’ major infrastructure projects—the Philippine National Railways’ North South Commuter Railway Project in Luzon.

The project will be funded with development assistance loans from the Japan International Cooperation Agency (JICA). The initial phase of the project involves a 38-kilometer elevated commuter rail from Tutuban, Manila, to Malolos, Bulacan. Besides infrastructure projects, JICA has also been providing assistance to the Philippines in improving its security capabilities. Earlier, the Philippines and Japan formalized several agreements that will help the former improve its maritime safety capability, including a deal for a 16.5 billion yen concessional loan covered by Tokyo’s Official Development Assistance (ODA) for the acquisition of two large-scale patrol vessels for the Philippine Coast Guard (PCG).

The agreement for the 16.5-billion yen loan signed by Dominguez and JICA President Shinichi Kitaoka during President Rodrigo Duterte’s official visit to Japan is part of Tokyo’s continuing assistance to the PCG’s Maritime Safety Capability Improvement Project (MSCIP). The JICA loan, equivalent to P6.8 billion, will be extended at an interest rate of between 0.01% and 0.10% with a maturity period of 40 years, including a 10-year grace period, according to the Department of Finance (DOF).

The acquisition of two 94-meter large-scale patrol ships under Phase Two of the MSCIP is on top of the ongoing ODA from Japan for the first phase of the project, which involves the procurement of 10 units of 40-meter PCG patrol vessels. One of the 10 patrol vessels was delivered to the Philippines last August 16, while the second one is expected to be handed over by December this year at the Japan Marine United Shipyard in Yokohama.

The targeted completion of the delivery of all the 10 vessels is set at August 2018. Besides the loan agreement, Japan has also announced the additional assistance for the PCG through a 600 million yen grant (about P280 million) for the procurement of high-speed boats and other equipment to boost the Philippines’ anti-terrorism and security activities.

This includes the acquisition of one 20-meter high-speed vessel and 14 units of 11-meter high-speed boats. (DOF)