ADB lending P24B to battle poverty

Asian Development Bank (ADB) has estimated a P24-billion financing for the Philippines under its new Country Partnership Strategy for 2024-2029 aimed at boosting inclusive socioeconomic growth and reduce the poverty rate to single digit.

“Income inequality has improved but remains one of the highest in Southeast Asia,” ADB said in its document on the new strategy.

“The country’s burgeoning youth population presents a demographic boon, yet the full potential of this human capital remains untapped due to shortcomings in education, health, job creation and innovation investment,” it added.

ADB said the loan will also support the construction of major infrastructure projects on transport, climate change and clean energy, digitalization, and agriculture.

The multinational lender said the new financing was designed to help the government gradually shift to more public-private partnerships as a cost-sharing method by 2029.

Through government subsidies to the poorest families in the country, ADB said the country’s poverty rate fell to 15.5 percent last year from 18.1 percent in 2021.

“We are leveraging our full suite of support modalities — financial and nonfinancial — to deliver transformative impact, ensuring that the benefits of growth reach all Filipinos, particularly the most vulnerable,” ADB country director for the Philippines Pavit Ramachandran said.

Human capital

While the Philippines’ economic growth at 6.3 percent in terms of gross domestic product in the second quarter was among the fastest in Southeast Asia, ADB said opportunities for higher quality jobs and high-value industries are needed.

“The manufacturing employment share is only 8 percent. Therefore, job quality remains a concern, with a third of total employment in vulnerable jobs such as own-account and unpaid family work,” it said.

ADB added that the government and businesses should encourage more Filipino women to study science, technology, math, and engineering to help the country seize economic opportunities.