Growth in the Philippines has been averaging at about 5 percent over the past 10 years, significantly higher than the rate achieved in the previous two decades. In 2010, the Philippines grew by 7.6 percent, the highest in 30 years. Read More »
The Philippines has been among the emerging markets in the region given its sound economic fundamentals and highly-skilled workforce. Growth in the Philippines has been averaging at about 5 percent since 2002, significantly higher than the rate achieved in the previous two decades. Amid global uncertainties, the economy posted a 6.6 percent GDP growth in 2012, driven by higher government spending and exports.
In recent years, the Philippines has restored stability and proved resilient to food and fuel price hikes, the global financial crisis and recession, and the impact of typhoons and El Niño. The country’s robust economic growth as well as the government’s sound fiscal management also saw the Philippines attain investment grade status from the Japan Credit Rating Agency, following similar upgrades from major credit raters in 2012.
Stable remittances have provided a strong basis for currency stability and a healthy build up of international reserves. The country currently enjoys a savings rate that exceeds investment, while its human resources continue to be in high demand around the world.
The country’s progress in achieving the Millennium Development Goals (MDGs) is generally on track in improving gender equality in basic education and reducing infant and child mortality. While the country is also making headway in combating tuberculosis, malaria and other major diseases, and in providing access to safe water, it needs to intensify efforts in reducing poverty, achieving universal primary education and in improving child and maternal health. It also needs to address the lack of good jobs among low-income earners, especially those from rural areas where many poor people reside.
To address these challenges and to achieve inclusive growth, the government has vowed to pursue the following measures under its (2011-2016) Philippine Development Plan:
* Attain high and sustained economic growth that provides productive employment opportunities;
* Promote equal access to development opportunities through better education, primary health care and nutrition and other basic social services; equal access to infrastructure, credit, land, technology, and other productive inputs;
* Uphold good governance and strong institutions to encourage competition; and
* Establish effective and responsive social safety nets to assist those who are less capable of participating in economic activities
The World Bank Group’s country assistance strategy for the Philippines from 2010 to 2013 revolves around the theme “Making Growth Work for the Poor”.
This means making sure no one, especially the poor, is left behind. Households and communities most at risk for poverty should have better income opportunities and less vulnerability to sudden economic difficulties and natural disasters. They should have better education, good health care, as well as access to infrastructure and information to improve their lives and to participate in growing the economy.
This also means that more and better jobs – jobs that raise real wages or bring people out of poverty - should be created for some 10 million unemployed and underemployed Filipinos as of 2012, including 1.1 million individuals who expect to enter the labor force every year.
The strategy supports the government’s priorities in achieving a stable economy, encouraging investors, increasing access to public services, reducing harm from disasters brought about by climate change, and by providing social safety nets.
Improving governance and fighting corruption through a more transparent and accountable government is integrated in every program or project the World Bank supports. It also seeks deeper integration of the operations of the World Bank and the International Finance Corporation in the areas of infrastructure, agribusiness, and the financial sector.
As of March 2013, the Philippines portfolio comprises 22 active projects with a total net commitment of US$ 2.05 billion. This includes 15 investment loan operations and 7 large trust funds that are part of the lending portfolio. In terms of sector distribution, infrastructure tops at 33 percent of the total, followed by human development at 27%, rural development and environment at 13%, and social development at 12%. The remaining 15 percent covers policy-based financing for inclusive growth.
Since 1957 when the government received its first World Bank loan, the Bank has financed critical infrastructure and rural development needs that have produced significant results for its citizens. The Bank’s assistance later expanded to a wide range of lending and knowledge products, policy advice and capacity development in support of the country’s agenda.
Investments in the roads sector were aimed at increasing mobility and reducing the travel time of road users. Support has evolved from typical construction and upgrading of roads towards enhancing roads management through a system of road improvements, asset preservation and more efficient business processes with strengthened governance and anti-corruption measures.
One such project is the recently completed Metro Manila Urban Transport Integration Project which has helped enhance the operational efficiency and safety of the transport system in the capital with the completion of infrastructure projects that include a bridge, secondary roads, footbridges and elevated walkways as well as some 50 kilometers of bikeways.
In terms of reducing rural poverty among agrarian reform beneficiaries, the average household income of project beneficiaries rose by 41% through the Bank-funded Second Agrarian Reform Communities Development Project.124 communities benefited from the construction and improvement of irrigation facilities, roads and bridges which facilitated access to farms as well as to key support services in health, agricultural technology, enterprise development and livelihood assistance, education and credit. The second phase of the Mindanao Rural Development Program (MRDP) Phase II has promoted rural growth in southern Philippines, increasing the average household income of beneficiaries by about 16% from 2007 to 2011, which is more than double the targeted increase for the period.
The Second Women's Health and Safe Motherhood Project also promotes maternal and infant health by encouraging mothers in project sites to seek child and maternal health counseling, pre-natal and post-natal care, develop birth plans and to have their deliveries attended by health personnel in health facilities. From the national average of 23% in 2004, childbirths in health facilities jumped to 58.37% in 2011.
In the water and sanitation sector, the Bank has been supporting the government’s efforts to improve services across the country by partnering with service providers and local government units. Residents with improved access to drinking water increased from 85% in 1990 to 92% in 2010, while access to sanitation facilities improved from 57% to 74% over the same period.
In Metro Manila, the Bank’s interventions through Manila Water Company (MWCI) contributed to a dramatic increase in 24-hour water supply from 26% in 1997 to 99% in 2009 as it expanded coverage of sewerage, sanitation and septage management.