Philippine President Rodrigo Duterte has instructed all government agencies and local government units (LGUs) to implement the new six-year development plan in order to accelerate infrastructure development and expand opportunities in industry and services.
Duterte on June 1 signed Executive Order No. 27 series of 2017, which directs all government agencies and LGUs to implement the Philippine Development Plan (PDP) and the Public Investment Program (PIP) starting this year until 2022.
PDP is the updated medium-term plan anchored on the AmBisyon Natin 2040, the long-term plan for a stable and comfortable life for Filipinos, to be accomplished by creating a more inclusive, high-trust and resilient society, and globally competitive knowledge economy.
The country’s development program was approved by the National Economic and Development Authority Board on February 20 this year, following a series of Cabinet-level and technical inter-agency and stakeholder consultations.
Sweeping plans
Among the plan’s goals are to strengthen value and supply chain linkages, remove restrictions, provide incentives, and promote job-creating investments so as to increase local and foreign direct investment (FDI) in the country.
According to the plan, industry and services will be integrated to make them globally competitive, largely by strengthening forward and backward linkages for more efficient supply and value chains.
The PDP, particularly its Chapter 9, also seeks to expand opportunities in industry and services, particularly for micro, small, and medium enterprises (MSMEs), cooperatives, and overseas Filipinos.
Tightening value and supply chain linkages will entail improving backbone services, such as distribution, transport, and logistics services, to facilitate movement of people, goods, services, knowledge, and ideas, as well as link firms, especially MSMEs, to domestic and global markets.
“Investments in infrastructure and logistics will also boost competitiveness, improve connectivity, and reduce costs,” the PDP notes.
Also sought is to amend restrictive provisions in the Constitution; repeal or amend relevant laws, rules, and regulations that restrict foreign participation in certain economic activities; and ensure that regulations promote fair competition.
The incentive system will be modernized to remove nationality and export biases and make it more relevant to investors and more competitive with other Association of Southeast Asian Nations (ASEAN) member states.
The medium-term plan also seeks to increase the competitiveness, innovativeness, and resilience of industries and services in the Philippines.
To achieve this, the plan aims to develop high-value added, competitive, and sustainable sectors; improve the business climate; improve access to technology and innovation; and enhance labor capacities.
Other goals are to improve market access; ensure consumer access to safe and quality goods and services; improve access to production networks and finance; and enhance productivity, efficiency, and resilience.
Moreover, PDP lists legislation needed to propel these strategies. These include the Ease of Doing Business Act, Inclusive Business Bill, and amendments of the Public Service Act and the Retail Trade Liberalization Act.
The PDP also supports the repeal or amendment of the Flag Law (Commonwealth Act 138) to create a level playing field for foreign firms in bidding for government procurement.
Infrastructure development
The PDP notes that despite improved and expanded transport systems, “it is still inadequate vis-à-vis the growing demand.”
Thus, it underscores increasing investments in infrastructure and accelerating infrastructure programs and projects. This is mainly by ramping up spending on infrastructure to at least 5.3% of GDP in 2017 and possibly to 7.4% in 2022.
“With a growing economy, the Philippines requires more and better selected infrastructure investments, given its archipelagic landscape, expanding population and rapid urbanization,” PDP Chapter 19 states.
PDP lists four major strategies to accelerate infrastructure development, and these are to increase spending on public infrastructure; implement strategic infrastructure for the various infrastructure subsectors; ensure asset preservation; and intensify research and development on cost-effective technologies.
In particular, the plan aims to enhance the transport sector by providing adequate, accessible, reliable, and safe access for people and goods moving across the country, to neighboring regions, and to other parts of the world.
Accordingly, “there is a need to enact a National Transport Policy and to create independent regulatory bodies for the railways, airports and seaports, among others, to establish a more streamlined transport sector that is able to efficiently and effectively carry out the identified development strategies.”
Roadmaps and evidenced-based studies should be used to guide the rational development of an intermodal transport infrastructure network.
To improve connectivity and mobility, multi-modal transport terminals will be established, complete with ancillary facilities to provide smooth transition for passengers and freight from one mode to another.
New economic centers will be supported with transport infrastructure and services in accordance with land use and urban planning methodologies and other sustainable construction technologies that have been proven effective in livable cities.
Transport agencies must continue to forge convergence programs with concerned agencies to ensure that economic sectors are offered adequate transport infrastructure support and services.
To support development in Mindanao, road projects under the Mindanao Logistics Infrastructure Network are to be pursued along with the Improving National Roads for Inclusive Growth in Mindanao Projects in Western Mindanao. The capacity of the Brunei Darussalam, Indonesia, Malaysia, the Philippines-East ASEAN Growth Area road network will also be increased.
Easing traffic congestion
In the short term, the plan says road-based transport will be improved by addressing traffic congestion through “engineering, enforcement, and education,” while in the long run, the road network will be upgraded and expanded to the highest quality standards.
The desired shift from private to public mass transport should be encouraged by ensuring the accessibility, affordability, adequacy, and reliability of rail transport and bus rapid transit (BRT) systems.
The government will exhaust all possible means to improve the operational efficiency of airports and to address constraints to optimal capacity utilization.
In particular, strategies will focus on decongesting air traffic in the greater capital region, such as building a new international airport.
Meantime, movements at both land and air facilities at the Ninoy Aquino International Airport are to be optimized, while the development of Clark International Airport will be fast-tracked, including the establishment of a fast and direct access to Manila, such as rail.
Port facilities will be improved so that inter-island shipping, including a stronger roll-on/roll-off network, remains a viable transport option for people and cargo.
The government aims to expand port facilities and fully utilize existing ports.
In particular, “a more direct connection between Manila and Batangas ports will be explored and co-loading (modified cabotage) will be implemented to encourage shipment between domestic ports.”
“Existing dry ports will be improved and new ones will be built to provide support to manufacturers, importers, and exporters. These will be done by reducing vehicle turnaround time, thus, accelerating trade movement,” the plan says.
It added that logistics hubs will be developed to connect industrial and manufacturing zones as well as agro-industrial areas, to major port areas.
The plan aims for the safety and security of the public transport system by adopting a universally accepted security structure to eradicate activities that may cause injury, death, loss, or damage to property.
Laws governing transport
Part of the legislative agenda to hasten infrastructure development is to amend the Build-Operate-Transfer Law and its implementing rules and regulations; enact a National Transport Policy; and enact a law creating an independent body for transport safety and security.
Another goal is to enact a law creating independent regulatory bodies for railway and maritime transport sectors, which the PDP says “addresses the weak and fragmented institutional setup of concerned transport agencies by creating respective independent regulatory bodies for the railway sector and maritime transport sector, consistent with the National Transport Policy.”
“The existing dual roles of some agencies acting as both operator and regulator of transport facilities will be effectively eliminated,” it adds.
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