Infrastructure serves as the foundation of every economic development of the countries. Infrastructures are vital for growth and competitiveness of a country’s economy. It helps improve the standard of living and making the country attractive for investors. However, based on statistics, the Philippines is ranks 56th out of 140 countries with no improvement in 2017- 2018 and 92nd in the infrastructure category, according from The 2018 World Economic Forum Global Competitiveness Report. Moreover, based on UN Economic and Social Commission for Asia and the Pacific’s Asia- Pacific Countries with Special Needs Development Report in 2017 reveals that the Philippines scored 0.336 in the access for physical infrastructure index for 2015 and was places 24th out of 41 in Asia and Pacific countries. Meaning, our country is no competitive enough and stepping the standard in the modern world of infrastructure category.
One of the major effect of poor infrastructure in our county is the daily traffic gridlock in Edsa, a major traffic corridor in Metro Manila. This is just one highly visible example of past under-investment in the infrastructure of our country. Overall, there is a lack of quality infrastructure thus insufficient modes of mobility. Some of the infrastructure problem in our country that causes traffic are: road network, the railway system, road-based public transport, urban planning problems, urban area expansion, traffic congestion, economic theories, high population, growing number of private 4-wheel vehicles, public transport system and road accidents. With regards on high population, many of the people from rural areas are migrating to Metro Manila in order get better job opportunities. This is because most of the big businesses are here. They also want to get high salary compared to a provincial rate compensation. This situation is very familiar for even the researchers can attest with the decision given towards the current situations. The questions is if not all the developments be done in the core territory of the Philippines which is Metro Manila, does there will be a huge changes? If only government can encourage business owners to put up their businesses outside Metro Manila and give a higher compensation compared to the provincial rate, this might help reduce the population in the metro. Some of the effects of traffic in our country are: Societal: wasting of time, delays, frustrated drivers, Economy: damaged vehicles, loss of revenue for public transport, Environmental effects. Among the effects of traffic in our country, which is the main concern of the researchers. The longer the vehicles are in the road the more it produces air pollution. Air pollution is silent killer. We may not see it but it already affected the lives of a number of Filipinos. Dirty air is a threat for millions of residents in Metro Manila.
Because of this, the government spend P910 Billion pesos for the infrastructure and started build more under the president’s project “Build Build Build”. The government see the project as the solution to help the nation improve its infrastructure and the sub sectors under it. The researchers hope that the government’s project about building new infrastructure will not add up to the current situation right now. After all, infrastructure will always improve connectivity and accessibility. It also boost land values in what were once difficult to reach localities. Building new infrastructures in our country is really a big thing for our economy. Just hoping that everyone will a benefit out of it.
Infrastructure refers to the physical aspect of business or nation. It includes technology, communication, water, electricity, sewage. It can be used as great investment of every business in a country. Projects related to infrastructure must be funded publicly or privately or in public-private partnerships. According to J. Chappelow, 2019 the term infrastructure is used in the English language in the late 1880s. It came from Latin roots “infra” means below and “struere” means to build. Infrastructure serves as the foundation of every economic development of the countries. Infrastructures are vital for growth and competitiveness of a country’s economy. It helps improve the standard of living and making the country attractive for investors.
The Philippines has a very huge population. However, the dissemination of the population inside the country is not even, which resulted into a big congestion in the area of Metro Manila. According to Metro Manila Statistics, the daytime population of Manila sets up to 15Million, and goes down by 12Million by nighttime indicating that there are 3 Million who commutes to city everyday. Reasons taken are because of lack of job opportunities to places outside the city. It is not a good news knowing that the Philippines ranks 56th out of 140 countries with no improvement in 2017- 2018 and 92nd in the infrastructure category, according from The 2018 World Economic Forum Global Competitiveness Report. Moreover, based on UN Economic and Social Commission for Asia and the Pacific’s Asia- Pacific Countries with Special Needs Development Report in 2017 reveals that the Philippines scored 0.336 in the access for physical infrastructure index for 2015 and was places 24th out of 41 in Asia and Pacific countries. And there are a lot of factors why we still stay behind with our other Asian neighboring countries. One must remember that our country is also known for its traffic conditions, long commutes, and slowest internet connection in Asia, despite of tons of partnership of the government to the other nation. The following Sub Sectors are mainly the major reasons for this matter. For example, the North Luzon Expressway and Subic-Clark Tarlac Expressway are owned by Metro Pacific Group, which is a private group of company. Companies that finance, design, construct, operate, and maintain the infrastructure have a great power to the performance of that infrastructure. The researchers think having a private group owned a public road for transportation is not a good start to keep our infrastructure better. Its means the government has not enough power to control in the inside management, which can lead into capitalist overpowering and dominating the sector. As a further matter the Equipment, product and technologies that can be used for the projects are not that updated and keeping to the modern changes. In fact, according to Speed test Global Index, in terms of mobile internet speed, the Philippines ranks 103rd among 139 surveyed countries. The download speed of 15.06 megabits per seconds was far beyond the global average of 26.12 mbps. This resulted to lost of income in digital marketing field and predicament in the infrastructure industry which is supposedly trying for an enhancement. That is why under Duterte administration, foreign participation were increased as efforts to providing another competitors in terms of telecom. Government allow entering another telecom and power sectors to break the dualistic situation as well as the worsening situation of internet in Asia because of this we can attract more investors that can compete for the service. An increase to foreign investments as well as better infrastructure is the key to boost our economy gradually.
Expanding economy like our country, Philippines, is already starting to build more infrastructure by upgrading roads, bridges, and airports under the so called “golden age of infrastructure” under the Pres. Duterte’s project called the ‘Build, Build, Build’ program which is actually funded by the support of foreign countries. The funds are from the Asian Development Bank (ADB), Japan International Cooperation Agency (JICA), China’s Belt and Road Initiative (BRI) and the establishment of the Asian Infrastructure Investment Bank (AIIB). ‘Build, Build, Build’ program is at the at the center of the president’s Socio Economic Agenda. The idea is that the infrastructure project will increase the productive capacity of the economy, create jobs, increase incomes and ultimately reduce poverty.
This year, the government has planned to spend P910 billion on infrastructure and double that by 2022 to pave the way for a "golden age of infrastructure."Based on the presentation by Budget Secretary Benjamin E. Diokno at the Philippine Economic Briefing in Osaka, Japan, last February 25, the 2019 gross domestic product (GDP) investment plan would be equal to 4.7%.
This infrastructure plan were said to break the P1- trillion mark by the year of 2020. Because by calculating the expenses that will be spent on roads, bridges, airports and railways next year, they will be needing a P1.22 trillion or 5.7% GDP. This will continue to increase in 2021 with P1.54 trillion or 6.6% GDP and possibly be at P1.81 trillion equal to 7% of GDP by the year of 2022.
In regards with the funding, according to businessmirror.com, the Japanese government is funding P69,065 billion worth of projects for road and bridges to help the Philippines increase it’s investment and open more jobs for the workers. “We want to help the Philippines improve the conditions of its roads and bridges so more investments can come into the Philippines and more jobs will be created,” said Japan International Cooperation Agency (Jica) Senior Representative Kiyo Kawabuchi.
JICA (Japan International Cooperation Agency) said to fund it’s largest project worth P20.423 Billion pesos for the RUPP (Road Upgrading and Preservation Project) which will be used to fix the severe damages due to earthquake along the Bohol circumferential road. Followed by the next project which is the Davao City bypass construction project both south and center sections. That project worth P11.953 billion which will build a four-lane road and a tunnel in the city.
Other projects funded by Jica include the Central Luzon Link Expressway Project P11,398 billion; the road network development project P10,735 billion in conflict-affected areas in Mindanao; and the Metro Manila Interchange Construction Project P3,965 billion. In 2014, the Philippine Government approved the Roadmap for Transport Infrastructure Development for Metro Manila and its Surrounding Areas for JICA and the National Economic and Development Authority to support development through decongesting traffic and spreading economic growth in nearby areas. Since 2013 to 2017, transport infrastructure accounted for 80% of Jica's overall Official Development Assistance (ODA) in the Philippines, which also covers roads and railways. Japan is the top ODA investor in the Philippines with a $352 million ODA disbursement in 2017.
Philippines became one of the best performing economies in Asia. Based on the data gathered by the International Monetary Fund 6.6% economic growth in 2019 and it can be followed by the observation of the WORLD BANK. This good news is attributed to the Build, Build, Build, program of the government that aims to accelerate our infrastructure. By develop existing industries that can provide more opportunities for every Filipino citizen. At present 44 out of 75 proposed projects has been implemented under this BBB program. The department of trade and industry has recording Php31.8 billion of investment in 2019 compare to 18.2 billion of 2017. These figures make our country attract more foreign investors that can contribute to the Philippine economic growth. According to R,j. Heydarian 2019. Although the county has outgrown “the country’s growth has been shallow and far from comprehensive, leaving high levels of unemployment, poverty, and hunger relatively untouch” it means that whether you get high economic performance it will never cover up the illness that serves as effects of poorness of our country.
The infrastructure of the Philippines serves as ACHILLES heel so that if you add more infrastructures it can drive economic growth and lift up many citizens out of poverty. As this project will bloom can give lots of opportunities for construction workers and the shortage of talents will be apparent for engineering professionals but the success of this program also depends on them. As we experience today we are in the on going process of building more infrastructures but it only provides some opportunities but also creates more poverty. Many people are being force to leave their homes because it will serves as the location of where this infrastructure will be created so how can we be so sure that this project will be helpful to us when it creates more opportunities while destroying homes as well.
As the area of Metro Manila becomes congested, the infrastructure for the logistics and distribution is now the main problem solution. Because of heavy traffic within the area of Manila, the Philippines loses Php. 3.5 Billion a day and is expected to continue growing numbers if the traffic problems can’t have a suitable and effective solution. As of now one can’t say if the “Build Build Build” program by President Duterte is a complete solution, or just another reason for more heavy traffic occurrence. The Duterte administration sees the Build build build program as the solution, and allocates $180 Billion for the said project. The government aims that the Build build build project will jack up infrastructure and social spending to about 7.1% of gross domestic product until the end of its term in a bid to boost the economy to 7-8% growth in 2022. The researchers think that it is a good project to invest with, specially that we all know how infrastructure leads everything, for it dictates the developer’s next strategies and boost not just land values, but also nation’s revenues.
However, The researchers think that the government decision on shifting the bankroll of fund for initial capital from public-private partnership (PPP) to Public and official development assistance (ODA) is a risk. Part of the change will make the investors lost their interest and will make the partnered country powerful. As the government becomes more opened for other nation’s to have a control in the industry. Even though long before, the government becomes opened for other nation’s donation such as the countries of Japan, Korea and China, today is a different story. Mr. Oplas from Business World said “A China-ODA [arrangement] would mean only Chinese contractors, suppliers, managers, and even workers would do the work. Local firms would be relegated to O&M (operation and maintenance) and their purchase of equipment and supplies might be constrained by the project specifications so that they will be forced to source these from China again,”. By this we can see that the China is just taking advantage of this partnership and we cannot really assure that after the current administration, there will be a political bond that can protect the country’s project as Duterte is favoring foreign money to fund BBB. This can also result to withdrawal of other PPP projects can also lead to political risk under the President Duterte and his administration.
Nonetheless, the researchers agrees that the government made a good decision to their decided solution for Airport traffics. Since NAIA is currently serving 42Million passengers when its original capacity is just for 30Million, they plan to redirect traffic to Clark International Airport. Because of this plan, Clark International Airport got 63% increase in passenger traffic as of July 2019, which is a positive effect. The measurement of NAIA-Clark Airport solution and the proposal for New Manila International Airport Project ( Bulacan International Airport) located in Bulcan will not just decrease passenger traffic in congested Airports, but will also provide commercial and job establishment within the area, and will even out the population in Metro Manila during day time.
Banking sector in the Philippine is increasing with double digit from 2013-2017. The industry also acquires positive scores in different stability indicators. According to Oxford Business Group, the banking sector considered to be highly liquid and well managed even when credit becomes a major concern. Overall positive prospects are observed as poverty rates decline and employment rise, Even if these are the benchmark of all economy there always a room for “improving critical information infrastructures” of the country.
The researchers think that we must invest to CII or Critical Information Infrastructures. These are physical or virtual assets that comprises systems and networks that is very important that their destruction would creates more effective national security and public order. With a positive investment for the Philippines in 2019, improvement of CII meets domestic demands especially in Information and communication sectors that lead to the golden age of infrastructure. Towers are the Physical CII it serves as a tool of the connections between business, public, organization, the government and individuals. Indeed concrete, steel, and fiber-cables that is very important on building blocks of the Philippine economy. Infrastructure also enables trade, businesses and other workers to have more opportunities and jobs. Either from public or private sectors a secure infrastructure is the backbone of achieving our main goal where in we can provide lots of opportunities and job to all Filipinos over the decades.
Infrastructure serves as the building block of our economy not just by today but also for couples of years after today. Because it can attract more investors and can give a lot of job opportunity for our fellow Filipino. We must focus more on CII rather than creating physical infrastructure. As technology evolves the infrastructure evolve as well. We may invest to the Information and communication to develop and innovates our old infrastructure and for us to easily connect to other countries for trading. CII also creates opportunities to attract more investors for said infrastructure that can provide more jobs for Filipino as well. we must not just focus on building and building physical infrastructure perhaps we must focus also to the advancement of our technology because if all are growing more positive outcomes will happen.
Our government has great plan presented to us, it is also clear for us that it’s purpose is to innovate and have a more functional country in terms of infrastructures. Based on the information gathered, our country still need to have a greater amount of budget to make those projects possible. In regards with the budget, Japan is still a country that always helps the Philippines. That’s one of the opportunities that our government can work on, for next time we don’t have to depend anymore to other country’s help and just ask if it is badly needed and necessary. On the other hand, it is also a great opportunity for our country to accept some help in regards with the budget, in that case we can still use the other funds for some specific projects that is also needing a fund along with the infrastructures project. But we must not totally relay on other nation’s help, we should consider more of the inside capital support to avoid risk.
The researchers hope that the government’s project about building new infrastructure will not add up to the current situation right now. It is good to see our country being competitive and not staying with mediocrity. At the same time, we must consider all factors that might be affected due to the change that will happen, especially our environment. After all, infrastructure will always improve connectivity and accessibility. It also boost land values in what were once difficult to reach localities. Building new infrastructures in our country is really a big thing for our economy. Just hoping that everyone will a benefit out of it.
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