Aquino outlines development roadmap

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Philippines roads
Road project in Ilocos Norte, Philippines

Philippine President Benigno Aquino III has outlined a three-pronged developmental approach to sustain the blindingly high economic momentum the country has achieved through heavy investment in infrastructure, it was announced at the Euromoney Philippines Investment Forum at the Peninsula Hotel in Makati, Manila on March 12.

“There are three sectors that remain priorities: agriculture, tourism and [transport] infrastructure,” President Aquino said, adding that infrastructure projects in these areas will receive a larger spotlight from the government.

Beyond infrastructure projects that will strengthen irrigation systems and deploy roads for easier access to tourism destinations, the Philippines, through the country’s PPP programme, has listed a number of projects that are worth at least $7.4 billion.

“The prioritisation of infrastructure has increased dramatically since [Aquino] took office,” Secretary of Finance Cesar Purisima said at the forum.

“Good feasibility studies to balance risk between the public and private sectors have been conducted. In 2012, [the Aquino administration] built a pipeline of over 13 projects, a portfolio that is steadily increasing,” he added.

Prioritised projects in the Philippine PPP programme slated for roll-out in 2012-2013 in transport – rail, airports, ports and roads – are valued at $2.9 billion, while other infrastructure contracts reach nearly $2 billion.

The tourism industry has been allocated a segregated budget for 2013 worth $295 million amassed strictly for road infrastructure.

“Tourism is a heavily invested industry [in the Philippines],” Aquino said.  “We are expecting a spike in arrivals and it appears we will need to add 37,000 rooms by end-2013. We are offering fiscal and non-fiscal incentives in tourism for private investors.”

“You only have to visit Boracay, the islands of Palawan or the walled city of Intramuros to understand the attractiveness of our country,” Aquino gushed.

Agriculture, which employs 12.5 million of the over 40 million workforce, will continue to play a significant role in the economy, with plans to begin exporting at least 100 metric tonnes of rice before April 2013.

“This is why our agricultural budget has increased 61 per cent in 2013,” Aquino continued.

However, the sector has yet to capitalise on the self-sufficiency of Filipino farmers.

“There are market inefficiencies in agriculture because we are self-sufficient in our rise,” said CEO and Managing Director Manuel Pangilinan of investment holding firm First Pacific. “There are crops that we should have had done a few years ago, such as palm oil. Infrastructure has also been a constraint.”

A dominant contributor to the domestic consumption-led economy, Aquino also alluded to the country’s vibrant BPO industry as an enabler of inclusive growth.

Foreign investment, a key enabler of innovation and competition, still lags in the Philippines. Although rating firms S&P, Moody’s and Fitch all put the Philippines just one notch below investment grade, foreign direct investment inflows into the country remain low.

In addition, the Philippines’ debt securities are trading at about four to five notches above investment grade, producing low yields that have made the vibrant economy a victim of its own success.

 

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Reading Time: 2 minutes

Road project in Ilocos Norte, Philippines

Philippine President Benigno Aquino III has outlined a three-pronged developmental approach to sustain the blindingly high economic momentum the country has achieved through heavy investment in infrastructure, it was announced at the Euromoney Philippines Investment Forum at the Peninsula Hotel in Makati, Manila on March 12.

Reading Time: 2 minutes

Philippines roads
Road project in Ilocos Norte, Philippines

Philippine President Benigno Aquino III has outlined a three-pronged developmental approach to sustain the blindingly high economic momentum the country has achieved through heavy investment in infrastructure, it was announced at the Euromoney Philippines Investment Forum at the Peninsula Hotel in Makati, Manila on March 12.

“There are three sectors that remain priorities: agriculture, tourism and [transport] infrastructure,” President Aquino said, adding that infrastructure projects in these areas will receive a larger spotlight from the government.

Beyond infrastructure projects that will strengthen irrigation systems and deploy roads for easier access to tourism destinations, the Philippines, through the country’s PPP programme, has listed a number of projects that are worth at least $7.4 billion.

“The prioritisation of infrastructure has increased dramatically since [Aquino] took office,” Secretary of Finance Cesar Purisima said at the forum.

“Good feasibility studies to balance risk between the public and private sectors have been conducted. In 2012, [the Aquino administration] built a pipeline of over 13 projects, a portfolio that is steadily increasing,” he added.

Prioritised projects in the Philippine PPP programme slated for roll-out in 2012-2013 in transport – rail, airports, ports and roads – are valued at $2.9 billion, while other infrastructure contracts reach nearly $2 billion.

The tourism industry has been allocated a segregated budget for 2013 worth $295 million amassed strictly for road infrastructure.

“Tourism is a heavily invested industry [in the Philippines],” Aquino said.  “We are expecting a spike in arrivals and it appears we will need to add 37,000 rooms by end-2013. We are offering fiscal and non-fiscal incentives in tourism for private investors.”

“You only have to visit Boracay, the islands of Palawan or the walled city of Intramuros to understand the attractiveness of our country,” Aquino gushed.

Agriculture, which employs 12.5 million of the over 40 million workforce, will continue to play a significant role in the economy, with plans to begin exporting at least 100 metric tonnes of rice before April 2013.

“This is why our agricultural budget has increased 61 per cent in 2013,” Aquino continued.

However, the sector has yet to capitalise on the self-sufficiency of Filipino farmers.

“There are market inefficiencies in agriculture because we are self-sufficient in our rise,” said CEO and Managing Director Manuel Pangilinan of investment holding firm First Pacific. “There are crops that we should have had done a few years ago, such as palm oil. Infrastructure has also been a constraint.”

A dominant contributor to the domestic consumption-led economy, Aquino also alluded to the country’s vibrant BPO industry as an enabler of inclusive growth.

Foreign investment, a key enabler of innovation and competition, still lags in the Philippines. Although rating firms S&P, Moody’s and Fitch all put the Philippines just one notch below investment grade, foreign direct investment inflows into the country remain low.

In addition, the Philippines’ debt securities are trading at about four to five notches above investment grade, producing low yields that have made the vibrant economy a victim of its own success.

 

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