PH can meet poverty rate target by 2022

The Philippines is well poised to meet its target of reducing poverty incidence by 2022, with the Asian Development Bank (ADB) providing the necessary support to initiatives that aim to address inequalities across the country, such as the government’s massive infrastructure buildup and its social protection programs, according to a key official of the institution.

ADB Director General Ramesh Subramaniam said with the Duterte administration’s “robust” “Build, Build ,Build” program, infrastructure spending in the first quarter of 2018 increased 34 percent year-on-year, up from 12 percent compared with 2017 over 2016.

“I've been in the ADB in Manila for the last 20 years. I have not seen a momentum on the government side for the infrastructure development as we've seen in the last two years. And ADB is very happy to be working with the government on their efforts,” said Subramaniam in a recent TV interview.

He said that besides being involved in the Philippines’ infrastructure projects, the ADB has also supported its Conditional Cash Transfer (CCT) program, which, the ADB believes “has made a very concrete contribution” in reducing poverty and inequality in the country.

On infrastructure, Subramaniam said the ADB’s Improving Growth Corridors for Mindanao Road Project “will certainly be helping reduce inequality in that region by providing more growth opportunities, improving connectivity, developing small and medium enterprises in that part of the Philippines.”

“In the Philippines as well as elsewhere in the region, we are doing a lot of inclusive growth projects. In fact, if you look at poverty reduction or in poverty incidence, significant gains have been made across the region as well as particularly in the Philippines. We believe the country is well poised to bring down poverty incidence to below 14 percent by, say, 2022,” Subramaniam said.

The government, on the watch of President Duterte, has made it its goal to reduce poverty incidence to only 14 percent by 2022, and transform the country into a high middle-income economy by that time through aggressive spending on infrastructure and human capital development.

Subramaniam said Finance Secretary Carlos Dominguez III has underscored the importance of modernizing the country’s infrastructure as the government’s primary tool in reducing inequality in his capacity as chairman of the ADB Board of Governors this year, as well as in other forums.

“We hope that in our country partnership strategy, we will have a lot of opportunities to contribute on that front in the Philippines,” Subramaniam said.

Subramaniam also allayed fears of a possible overheating of the economy, saying this was no cause for concern, given the country’s strong macroeconomic fundamentals under the Duterte presidency.

He cited, for instance, the country’s comfortable level of international reserves, which stand at over $80 billion, representing close to about sevenand-a-half months of imports; the good performance of the financial sector; capital adequacy; and low level of nonperforming loans.

The recent investment rating upgrades that the Philippines has obtained on the Duterte watch is also another positive indicator that the economy “has been doing very well,” Subramaniam said.