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PRESIDENTIAL DECREE NO. 1939
PRESIDENTIAL DECREE NO. 1939 -
FURTHER AMENDING REPUBLIC ACT NUMBERED FORTY-EIGHT HUNDRED SIXTY, AS
AMENDED (RE: FOREIGN BORROWINGS ACT)
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WHEREAS,
the general rescheduling, restructuring or refinancing of the external
debt of the Philippines may call for the exclusion from the present
ceiling on foreign borrowings of specific categories of external debt;chanroblesvirtualawlibrary
WHEREAS, such rescheduling, restructuring or refinancing program would
likewise require guaranty by the Government for the external
indebtedness of corporations, including financial institutions, owned
or controlled by the Government of the Republic of the Philippines;chanroblesvirtualawlibrary
WHEREAS, as a complementary measure, there would be a need to adjust
correspondingly the ceiling on the total amount of external debt which
may be incurred or guaranteed by the Government.
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines,
by virtue of the powers vested in me by the Constitution do hereby
direct and order the amendment of Republic Act No. 4860, as amended, as
follows:cralaw:red
Section 1. Section 2 of said Act, as amended, is
further amended to read as follows:cralaw:red
"Sec. 2. The total amount of loans, credits or
indebtedness, excluding interests and other normal banking charges
which shall not be in excess of those imposed or charged by the
International Bank for Reconstruction and Development, the Asian
Development Bank or other reputable international organization or
non-governmental national or international lending institution, which
the President is authorized to incur under Section one of this Act
shall not exceed ten billion United States dollars or its equivalent in
other foreign currencies at the exchange rate prevailing at the time
the loans, credits or indebtedness are incurred at terms of payment of
not less than 10 ten years except those contracted in the interest of
national security and rehabilitation resulting from natural calamities:
Provided, That the price, interest rates and other charges on loans,
credits or indebtedness from non-governmental national or international
lending institutions or firms extending supplier's credits or deferred
credit arrangements shall be determined by the rules and regulations
which may be promulgated by the Central Bank: Provided, finally, That
seventy-five per centum of such total authorized amount of ten billion
United States dollars or its equivalent in other currencies shall be
incurred for projects of the public sector and twenty-five per centum
thereof shall be utilized for projects of the private sector and that
no individual, partnership, cooperative, association or private
corporation shall be allowed to borrow more than fifteen per centum of
the total of such loans, credits, indebtedness authorized to be
incurred for relending by the Development Bank of the Philippines or
any other government financial institution except those who may
undertake projects whose financial requirements are in excess of such
limitation, in which case the recommendation of the National Economic
and Development Authority and the approval by the President to exceed
such limit is required. chanroblesvirtualawlibrary
"The Central Bank of the Philippines shall promulgate and enforce such
measures as shall be necessary to reduce the external debt service
requirements to an annual level not exceeding twenty per centum of the
foreign exchange receipts of the immediately preceding year, provided
that, whenever necessary in connection with a general rescheduling,
restructuring or refinancing of the external debt of the Philippines by
foreign creditors, the President of the Philippines, upon
recommendation of the Monetary Board of the Central Bank of the
Philippines, may exclude specific categories of external debt from such
ceiling."
Section 2. The last paragraph of Section 3 of the
same Act, as amended, is hereby further amended to read as follows:cralaw:red
"The total amount loans, creditors or indebtedness incurred, and the
proceeds of bonds, securities or other evidences floated or issued,
which may be guaranteed by the President under this Section shall not
be more than seven and a half billion United States Dollars or its
equivalent in other foreign currencies at the exchange rate prevailing
at the time the guarantee is made excluding interest and other normal
banking charges imposed or charged by the International Bank for
Reconstruction and Development, the Asian Development Bank and other
similar international financial institutions." chanroblesvirtualawlibrary
Section 3. The said Act is further amended by adding
a new paragraph to Section 3, as amended, after the last paragraph
thereof, to read as follows:cralaw:red
"Notwithstanding the provisions of the preceding paragraphs, whenever
necessary in connection with a general rescheduling, restructuring or
refinancing by foreign creditors or in connection with credits obtained
to finance short-term trade, the President of the Philippines may, upon
the recommendation of the Minister of Finance, the Monetary Board of
the Central Bank of the Philippines, and the National Economic
Development Authority, guarantee in behalf of the Republic of the
Philippines foreign loans or credits to or external indebtedness of
corporations, including financial institutions, owned or controlled by
the Government of the Republic of the Philippines."
Section 4. Any provision of law or regulations
inconsistent herewith is hereby repealed, revoked or modified
accordingly.
Section 5. This Decree shall take effect immediately.
Done in the City of Manila,
this 27th day of June in the year of Our Lord, nineteen hundred and
eighty-four.
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