Carlos G. Dominguez
Secretary of Finance
GOCC Day and
Signing for the Malolos-Clark Railway Project
July 11, 2019
President Rodrigo Roa Duterte, Executive Secretary Salvador Medialdea, my fellow cabinet members and workers in government, Bangko Sentral ng Pilipinas Governor Benjamin Diokno, members of the legislature and diplomatic corps, heads of government-owned and controlled corporations, Asian Development Bank board members, development partners: good afternoon.
Thank you for being here today to join us in celebrating the government corporate sector’s contribution to the country’s progress.
Our government-owned and controlled corporations or GOCCs pursue a myriad of missions ranging from banking to building and maintaining our irrigation systems. Because each GOCC has a unique mission, they have different management requirements and financial performances. Regardless of their unique features, we expect our GOCCs to be all competently managed and efficiently run.
I am happy to note that the greater number of GOCCs operate with such efficiencies that they are able to turn in profits and remit dividends to the national government. In 2018,the total dividend collection from 56 GOCCs amounted to 51.2 billion pesos, representing a dramatic 41 percent increase from the 36.5 billion pesos collected in 2017. The amount includes cash and dividend contributions retained by government financial institutions to boost their capital requirements. This is the highest amount ever collected.
Last year, eight GOCCs contributed at least one billion pesos in cash dividend remittances, namely: the Philippine Deposit Insurance Corporation; Civil Aviation Authority of the Philippines; Bangko Sentral ng Pilipinas; Philippine Ports Authority; Philippine Amusement and Gaming Corporation; Philippine Charity Sweepstakes Office; Manila International Airport Authority; and National Power Corporation.
We also want to recognize Pag-IBIG Fund for declaring its highest dividend payout ever in 2018 amounting to 28.2 billion pesos. This was credited directly to its members’ accounts. As mandated by law, Pag-IBIG declares at least 70 percent of its income as dividends for all its members instead of remitting this to the national government.
As of July 2019, total dividend contributions from 53 GOCCs have already reached another record amount of 61.3 billion pesos. The same top contributors I mentioned earlier, including the Land Bank of the Philippines, made this possible. For this spectacular trend, we must thank all the good managers of the GOCCs, and I have to recognize also the Corporate Affairs Group of the Department of Finance headed by Undersecretary Antonette Tionko and ably assisted by Assistant Secretary Soledad Cruz. We also have to thank not only the officers and the board of the different GOCCs but also the secretaries who supervise these GOCCs for their wholehearted cooperation. Right now, they are represented here by Transportation Secretary Art Tugade, Energy Secretary Al Cusi, and Trade Secretary Mon Lopez.
The dividends collected by the national government help offset the subsidies given out to state enterprises performing crucial social functions. They will go a long way in helping us hold down deficits and continue funding the infrastructure and social programs of President Duterte. The 2019 dividend collections helped provide funding for the pensions of our uniformed personnel. They also helped augment funding for the Rice Competitiveness Enhancement Fund created by the Rice Tariffication Law.
By happy coincidence, we are also signing today a loan agreement with the Asian Development Bank that will fund the construction of a 53-kilometer new railway line connecting Manila and Clark International Airport. This much-delayed project is finally pushing through as part of this administration’s Build, Build, Build program.
The ADB will help us finance this project through a multi-tranche financing facility amounting to 2.75 billion US dollars or 141 billion pesos. This is the single largest infrastructure investment ADB makes in the Philippines and in any other country. This project will more than pay for itself and bring convenience to hundreds of thousands of commuters a day in what will be an extremely busy Manila-Clark corridor in the coming years.
The loan agreement we will sign today is the first tranche of the project amounting to 1.3 billion US dollars or 67 billion pesos. This is 47 percent of the total ADB financing support.
This loan demonstrates the close coordination between multilateral agencies and our bilateral development partners. The ADB is financing the civil works for this project, including the viaduct, bridges and stations for the rail service. While the Government of Japan, through the Japan International Cooperation Agency, will finance the core system, including the track, depot equipment, power supply and signaling systems. So far, we have worked with both the ADB and the Government of Japan in near perfect coordination.
I am happy our development partners have adapted quite well to the Fast and Sure approach in getting the major infrastructure projects going. The ADB and the Japanese Government are indeed our partners in their untiring support for the country’s growth and development.
Thank you very much.