State-owned Philippine Export-Import Credit Agency will guarantee the P25-billion exposure of government financial institutions, like the Development Bank of the Philippines and the Land Bank of the Philippines, to government’s P330-billion fiscal stimulus plan.

Philexim president Francisco Magsajo Jr. said the company had confirmed the loan cover for LandBank and DBP, which are each contributing P12.5 billion to the stimulus plan.

Pension funds Social Security System and Government Service Insurance System, the pension fund for government workers, meanwhile, are finalizing plans to lend to the stimulus progoram.

“SSS and GSIS were asked to join in the funding but as for their guarantees, we haven’t finalized that,” said Magsajo. The SSS and GSIS have committed to release P12.5 billion each for the government fiscal stimulus plan.

Philexim helps jumpstart projects in priority areas of the government by providing insurance cover, credit and other services. Guarantees provided to projects help minimize risks and bring down the cost.

Philexim will cover 85 percent of a stimulus-related project while the proponent will take care of the balance.

The government’s P330-billion stimulus package includes P160 billion in allocations, P100 billion from government financial institutions, pension funds and the private sector, P40 billion in tax breaks for corporations and individuals and P30 billion in temporary additional funds from the SSS and the GSIS.

The national government has also expressed interest to extend sovereign guarantees to SSS and GSIS on projects they will support in the state’s medium-term investment plan.

Half of the stimulus package is scheduled to be released within the first half of the year.

The government also said it would increase the guarantee fund of Philexim. Philexim recently raised P1.4 billion in tier 2 capital. Eileen A. Mencias