Human capital development in the Philippines has lagged compared to its regional peers due to the lack of investments in children’s early years, the World Bank (WB) said on Monday.
Data from the multilateral lender’s “The Philippines Human Capital Review” showed the country’s people index reached 0.52, which means that a child born in the Philippines in 2020 can only achieve about 52 percent of his or her potential productivity by age 18.
The World Bank defines human capital as the knowledge, skills, health and experience that people accumulate throughout their lives.
The Philippines’ Human Capital Index (HCI) value is below the regional average of 0.56 for upper middle-income countries, compared to Vietnam’s 0.69, Malaysia’s and Thailand’s 0.61 and Indonesia’s 0.54.
Three primary factors are taken into account while calculating the country’s HCI: health, learning-adjusted years of schooling, and survival.
The Philippines performed worse than its regional counterparts in five of the six subcomponents: the probability of survival to age five at 0.97, learning-adjusted years of schooling at 7.49, the fraction of children under five not stunted at 0.7, and the adult survival rate of 0.82.
With an expected years of school score of 12.95, the Philippines, however, outperformed its peers: Vietnam scored 12.86; Thailand 12.72; Malaysia 12.47; and Indonesia 12.39.
“It is important for the country to catch up in these areas and investing in human capital is not only urgent but also important for the Philippines,” said World Bank country director for Brunei, Malaysia, Philippines and Thailand Ndiamé Diop during the launch of the report in Taguig City.
“Whether the Philippines will reach high-income economy and development status would really depend on its investment in human capital today, so this is also what is at stake,” he said.
Although the government is carrying out initiatives to boost human capital, National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan acknowledged that more has to be done to capitalize on the Filipinos’ capacity for long-term prosperity.
NEDA said programs that foster human capital development include food stamp programs, the institutionalized Pantawid Pamilyang Pilipino Program (4Ps) to lower poverty, and providing health and nutrition assistance for children under two years old, as well as for nutritionally at-risk pregnant women.
Balisacan stressed the significance of having a program that addresses the entire life cycle.
“While we have been addressing education and health issues, human capital in general, I think we have to take a whole of government approach,” Balisacan said. “In the 4Ps for example, we only cover children or families who have children in elementary to high school.”
“But what about for those who are not in school yet who are poor? What studies show is that if you miss the first five years of mental development, emotional development, and psychosocial development, then you have already missed a lot and that cannot be recovered. So it’s very important that you have a program that covers that whole cycle,” Balisacan said.