The Philippines can overcome poverty

Reducing poverty has been one of the most pressing goals of the Philippines’ development strategies across generations. In order to contribute more to on-going discussions on poverty reduction in the country, the World Bank has recently completed a study titled “Making Growth Work for the Poor: A Poverty Assessment for the Philippines” based on the latest available official data. The results gave us hope that the country can overcome poverty.

The reason for this optimism is that from 2006 to 2015, robust economic growth and government policy helped the poverty rate in the Philippines to fall by five percentage points. Hence, poverty declined from 26.6 percent in 2006 to 21.6 percent in 2015.

The contributing factors for this decline in poverty were the expansion of jobs outside agriculture, government transfers, in particular, to qualified poor families through the Pantawid Pamilyang Pilipino Program, and remittances from domestic and foreign sources.

School enrollment has notably increased in recent years, with universal and mandatory kindergarten as well as two years of senior high school added to the education cycles. Pro-poor policies and changes to health insurance coverage have resulted in increased use of health services. Access to clean water and sanitation and electricity has improved. Social safety nets were expanded to cover most of the poor.

All these developments give us hope that poverty can be overcome. It is not at all insurmountable.

The Philippines, however, needs to do more to end poverty.

While poverty has declined, there are still about 22 million poor Filipinos, based on the 2015 Family Income and Expenditure Survey. These poor families most often live in rural areas with limited access to quality schools, health centers, and safe drinking water, not to mention roads and transportation that will help them go to their jobs or bring their produce to market.

Some poor families live in areas scarred by conflict or prone to natural disasters. Conflict can force families to move far away from their homes and sources of incomes. Disasters can knock down families that are struggling to climb the economic ladder.

Poor families are most often trapped in a vicious cycle of poverty. They usually have many children, an average of five per family. Pregnant mothers face high risk: every day, five Filipino women die in childbirth or due to other causes related to pregnancy.

In a poor family of five children, two will likely be stunted, a visible sign of malnutrition. Children who remain malnourished in the first 1000 days of their lives do not fully develop the neural connections in their brains, making them unable to reach their full potential, even as adults.

Just half the children in the poor households enroll in lower secondary school. Even those who do enroll may learn less due to malnourishment and poor quality of instruction. As a result, when they grow up, their chances of getting a well-paying job are slim.

In short, there are remaining challenges. What can we all do to address them? How can one family break from the path of poverty so that future generations would have a better life than their parents or grandparents?

The Poverty Assessment has suggested several recommendations, many of which are familiar to many Filipinos. Allow me to highlight a few.

The number one priority is creating more and better jobs, to offer opportunity for the poor to lift themselves out of poverty. Important steps include speeding up efforts to improve the business climate to attract more investments from firms of all sizes to generate more income opportunities for many.

Since two out of five of the country’s poor are in Mindanao, unlocking Mindanao’s potential is critical in bringing down poverty in the entire country. Increasing public investment in Mindanao to boost development there would expand opportunities for conflict-affected communities, broaden access to services and create more and better jobs.

In addition, tackling the country’s severe stunting crisis will require an all hands-on-deck effort, starting with maternal health and focusing health interventions on the “first 1000 days” of life.

And creating opportunities for children means also ensuring that the poor attend school and that the schools they attend foster learning.

Many of these policy suggestions align well with the Government’s long-term vision – the AmBisyon 2040 and the Philippine Development Plan 2017–2022, which aims to transform the country into a prosperous middle-class society. With solid economic fundamentals, the Philippines is in a stronger position to overcome poverty.

It is important to break the cycle of inequitable investment in human capital, making the pattern of growth more inclusive and creating opportunities for more and better jobs. The World Bank believes that, together, with various stakeholders, Filipinos can take concrete actions to end poverty in the Philippines.