ACCELERATING DUTERTE’S INFRASTRUCTURE PROGRAM

Last week, the Asian Development Bank ( ADB) released its 2017 outlook for the region. The Philippine economy is expected to grow by 6.4% in 2017 — a moderate pace that is still faster than several economies in the region. The ADB underscored, however, that greater investment in infrastructure would be crucial in insulating our growth from external risks, such as higher commodity prices and the uncertainties surrounding global trade.

In a round table discussion on “Infrastructure and Economic Growth: The Philippine Experience,” a Special Study written by Dr. Epictetus Patalinghug and published by the Stratbase ADR Institute, participants from the government, civil society, and the private sector discussed the

Philippines’ infrastructure experience.

The country’s infrastructure deficit has often been identified as a key bottleneck to sustaining economic growth and making it more inclusive. Due to decades of underinvestment, the quality of infrastructure has lagged behind our peers in the region, with demand rapidly outpacing capacity. Underinvestment in the sector is partly attributed to the lack of fiscal space. However, while the fiscal balance improved during the previous administration, the government continued to grapple with low infrastructure spending.

In November, the Duterte administration launched its “Build, Build, Build” campaign in its bid to roll out big- ticket projects. While P8.2 trillion is committed until 2022, President Duterte’s team has to overcome some of the challenges that constantly riddled the previous administration’s infrastructure program.

TECHNICAL DEFICIT

In 2016, infrastructure spending reached P493 Billion, a 42.8% increase, due to accelerated spending on roads, construction of school and educational facilities, and the AFP modernization program. Despite this improvement, 7.5% of the budget was still unutilized, in part because of poor planning and institutional weaknesses — the same issues that have hounded the Aquino administration. As Dr. Patalinghug asks, “How will the Duterte administration address the lingering technical deficit in the project planning, implementing and monitoring agencies?”