8% growth, ind’l dev’t: Marcos comes full circle

The development pursuit, founded on "Build Better, More" (BBM), towards an upper middle-income Philippines has guided the strategies and projects of President Ferdinand “Bongbong” Marcos Jr.

Over the next four years, his administration is targeting to boost economic growth to as high as 8 percent by 2028 that will employ funding from foreign governments and global institutions, public-private partnerships and the country’s first sovereign fund called the Maharlika Investment Fund.

Through these measures, Marcos expects the rise of new industries and expansion of traditional ones, such as agriculture and tourism, to generate more jobs in bringing down the country’s poverty rate to 9 percent or better and in securing affordable food prices.

“The underlying logic to our infrastructure development is economic efficiency. We are opening up all gateways to mobilize goods and services at less cost and in less time, and ultimately, to drive the economy forward,” Marcos said in his second State of the Nation Address in July.

“The hard lesson of this year has made it very clear that whatever current data proudly bannering our country as among the best-performing in Asia, it means nothing to a Filipino who is confronted by the price of rice at P45 to P65 per kilo,” he stressed.

The economy in the second quarter grew to 6.3 percent from 5.8 percent in the previous quarter as construction activities jumped by 16 percent and government expenditures rose by nearly 11 percent.

In May alone, government spending reached P557 billion from P455.7 billion recorded last year as the bulk of the funds was directed to the Department of Public Works and Highways, Department of National Defense, Department of Social Welfare and Development, and Department of Health.

Meanwhile, the government raised its budget allocation to the Department of Agriculture to P197.84 billion from P186.54 billion this year under a “progressive” approach.

“We forecast growth in Philippine gross domestic product of above 6 percent over the medium term or next two to three years supported by large investments in infrastructure and reforms to foster trade and investment, including public-private partnerships,” Fitch Ratings, a global credit rating agency, said.

Marcos, who is also chairperson of the board of the National Economic and Development Authority, approved 184 infrastructure projects covering multiple industries and are open to public-private partnerships or PPPs.

The projects cost a total of over P9 trillion.

Streamlined policies

Last year, Marcos signed into law the PPP Code which streamlined all policies regarding PPPs, making business transactions predictable and faster.

Data from the PPP Center showed 56 completed projects and 205 projects under implementation as Marcos builds on the infrastructure plan of the previous administration.

Through PPPs, the government is able to share costs of the projects and financial risks with the private businesses and tap their creative minds and technical skills to innovate, build, and operate projects.

PPPs include roads, bridges, railways, airports, seaports, flood management and irrigation infrastructure, digital infrastructure, and hospitals.

The Ninoy Aquino International Airport (NAIA) is set to be renovated after government officials in March signed the project’s concession agreement with the consortium consisting of San Miguel Holdings Corp., RMM Asian Logistics Inc., RLW Aviation Development Inc., and Incheon International Airport Corp.

The P170.6-billion NAIA rehabilitation project is the fastest-approved PPP proposal in Philippine history. Government agencies took only six weeks to evaluate the PPP proposal before Marcos approved it in July last year. The entire PPP bidding process was completed in 12 months.

“The reputation of this airport has been shredded, and let’s be frank about it, not by bad press but by its actual poor state,” Marcos said.

The government expects the new airport to spur tourism jobs that could employ more than 11.4 percent of the country’s total workforce.

Based on the World Competitiveness Index, the Philippines ranked higher in government efficiency at 49th this year from 52nd last year. A total of 67 countries were evaluated.

The NAIA rehabilitation project is seen as a step forward in terms of infrastructure as the Philippines ranked lower to 61st from 58th in the global index.

Water management

To address water security amid climate change, Marcos proposed the Department of Water which will streamline measures for water management and explore technologies for collecting water, storing, and recycling it.

Marcos said officials of the Water Resources Management Office are accelerating coordination efforts with lawmakers for the creation of the Department of Water.

The president reported the government has allocated P14.6 billion for water supply projects.

Marcos added there are already 6,000 rainwater collection systems across the country which can help mitigate the impact of El Niño.

“Recently, the water supply of the National Capital Region and Rizal received a significant boost from the first phase of the Wawa Bulk Water Supply Project. The water supply will increase as the Project enters the second phase,” Marcos said.

He shared that the country has around 11 million families without potable water.

Cheaper food prices

Apart from agricultural infrastructure, Marcos and his economic team have explored trade, land, and importation measures to lower food prices, especially rice.

Rice prices fell to 14.7 percent inflation last month from 20.9 percent in July after Marcos approved a lower tariff on imported rice of 15 percent from 35 percent.

Cheaper rice prices also came after Marcos, who briefly headed the Department of Agriculture, revived Kadiwa stores which sell cheaper food due to direct selling process from farmers to the market or without middlemen.

To prevent smuggled goods which causes manipulation of prices, Marcos said the government will be implementing pre-border technical verification and cross-border electronic invoicing of imported goods.

“Through modernized customs procedures and heightened enforcement efforts, more than P2.7 billion worth of smuggled agri-fisheries products have been seized, preventing them from entering the market and negatively influencing prices,” Marcos said.

Agri infra, assets

Through the Farm-to-Market Roadmap, Marcos aims to build a total of 131,410.66 kilometers (km) of such roads.

In 2022, the government reached 51 percent of the target or 67,255.46 km. In July, Marcos said 1,200 kilometers of new farm-to-market roads will be finished by the end of the year to further trim food costs due to high food transport costs.

“We will start planting high-value crops in these areas for higher incomes to farmers,” Marcos added.

For farm irrigation, the president said new 45,000 hectares of farm land will have water supply this year as the government continues to build the Malitubog-Maridagao Irrigation Project in North Cotabato and Maguindanao del Sur.

Meanwhile, the Cabaruan Solar-Powered Pump Irrigation Project in Isabela, which is the country’s biggest solar-powered pump irrigation project, and Jalaur River Multipurpose Project in Iloilo are now operational.

“These projects will not only provide irrigation to farmers but also flood control to other residents, tourism activities, and renewable energy,” Marcos said.

Under the Agrarian Reform, Marcos secured land ownership to over 113,000 farmers as he continued to urge them to form cooperatives and consolidate their land for full access to government benefits, such as agricultural loans and equipment.

“We have identified 300 farm clusters and 900 cooperatives managing over 200,000 hectares of production areas,” he said.

The agriculture industry breached less than 1 percent growth in the first quarter of 2023 at 2.2 percent from 0.3 percent in 2021, according to the Philippine Statistics Authority.

Food aid

For its food stamp project under the “Zero Hunger” program, Marcos secured $3-million funding from the Asian Development Bank (ADB) to provide food to 1 million poor households in the country.

The food stamps project uses electronic fund transfers with food credits to the beneficiaries, and is similar to government subsidies of the Pantawid Pamilyang Pilipino Program or 4Ps, which also covers health and educational needs of the poor families.

The World Bank said conditional cash transfer programs like 4Ps helped the Philippines reduce its poverty rate to 15.5 percent last year from 18.1 percent in 2021.

Digitalization, an imperative

Through eGov Super App launched last year, Marcos shared that the app now links the public to 24 government agencies, 14 cities and municipalities in Metro Manila and over 200 local government units in the provinces in helping ease government transactions.

To build a public broadband network, the government has secured P16.1 billion from the World Bank.

Based on the World Competitiveness Index, the Philippines ranked higher in government efficiency at 49th this year from 52nd last year.

To ensure better government policies and high-impact projects, Marcos strengthens ties with local and global investors from the public and private sectors.