THE Development Bank of the Philippines (DBP) will launch the National Maritime Equity Corp. (NMEC) this quarter to provide local operators enough access to vessel financing. DBP chairman Vitaliano Nañagas said the NMEC was formed to kick start growth in the local shipping industry by giving affordable loans to commercial and non-commercial vessel operators. NMEC will use the P6-billion fund from the Japan Bank of International Cooperation (JBIC) initially intented for the scapped Domestic Shipping Development Program in the late 1990s. Another P17 billion is scheduled to come in as additional fund for the NMEC, also from the JBIC.
“DBP lends money to the NMEC and lease it to the operators for those commercialized and non-fully commercialized,” the DBP chief added. Under the NMEC, the equity placement of investment is at 90%, 80% and 70% while the lease deposit of the loan propopent is 10%, 20% and 30%, respectively. Loan value for classed vessels is 60%. Interest rates are at 9% per annum for missionary routes and 10% for commercialized routes. The NMEC was formed as provided under Republic Act 9295 or the Domestic Shipping Development Act of 2004 aimed to modernize the country’s still-berth domestic shipping industry.
The Maritime Industry Authority (Marina) expects the MEC will wrest the ship-financing scheme out from banks. MEC will own, manage and lease ships to provide ship owners full access to ship financing. High interest rates and strict collateral requirements of Philippine banks are hindering the country from having a sustainable ship modernization program. Marina said the industry needs a more relaxed financing scheme to lure ship operators, especially small- and medium-scale operators which are the biggest service providers in the country’s shipping industry.
