PRESIDENT Aquino on Tuesday committed to further increase his administration’s multibillion-peso annual spending for various infrastructure and power projects in the remaining 15 months of his six-year term, which ends on June 30 next year.
Speaking before business leaders attending the Philippine Investment Forum at the Peninsula Hotel in Makati City, Mr. Aquino also vowed to continue pouring public funds to other government projects intended to create more jobs.
President Aquino announced his term-ending plans, as Moody’s on Tuesday increased its Philippine growth forecast for the year at 6.6 percent.
The President affirmed that infrastructure remains one of the sectors that greatly benefited from the government’s drive to become more competitive, acknowledging that, through the efforts of the Department of Public Works and Highways (DPWH), “corruption has been vastly minimized, if not eradicated” and projects are now regularly completed ahead of time and under budget, including those started by past administrations.
“The good news is that the DPWH’s budget has more than tripled: from P165 billion in 2010 to almost P570 billion in 2015. We can expect this to grow even more, as our goal is to have infrastructure spending comprise 5 percent of GDP [gross domestic product] by 2016,” he said.
Mr. Aquino assured that the administration is continuing to pursue another path toward accelerating infrastructure development in the Philippines, through the so-called Public-Private Partnerships (PPP) Program.
“Thanks to the good work of those in the Public-Private Partnership Center, we have proved to be exceedingly efficient in executing PPP projects. If you will allow me to make a quick comparison: The past three administrations combined were only able to complete six solicited PPP projects. On the other hand, under our administration, nine projects have been awarded; 16 are in the process of being bid out; and more than 30 other projects are under various stages of development.”
Mr. Aquino reported that another sector his administration is focused on is that of power, which, he admitted, “has been rather complicated, to say the least.”
“Rest assured: We share your concern. Right now, the Philippines has a total dependable capacity of 15,665 megawatts (MW), which is—or should be—sufficient to meet our highest projected demand level of 10,222 MW for 2015. But we cannot be content with this, especially with the potential power-supply gap in Luzon this summer, due to the threat of El Niño and rehabilitation of the Malampaya gas field,” President Aquino informed the investors’ forum.
At the same time, Mr. Aquino disclosed that his administration is also pursuing an entire menu of options to address this projected power-supply shortfall.
“We are expediting the rehabilitation of the 300-MW Malaya Thermal Power Plant Unit 1 to help augment power supply in Luzon. We are also requesting National Grid Corp. of the Philippines [NGCP] to optimize the dispatch of hydropower plants, which will generate additional energy supply during peak hours. Partnerships with the private sector have also proved useful: Under the Interruptible Load Program, as of January 2015, 252 participants have signed up to use their own generators and deload a total of 688.67 MW during times when power supply is too tight.”
According to Mr. Aquino, the good news is that a total of 48 committed incoming power projects with 4,693.6 MW of power are expected to come online between now and 2018. He added that out of the 48 power plants, 21 will be from renewable energy, in line with the government’s goal of diversifying the energy mix and building a power supply that is as clean and reasonably priced, as possible.
“As you can see, we are determined to continue treading green pathways to development, and to maintain our status as one of the driving forces for clean energy in the region. As I have said before, our vulnerabilities to climate risk should not keep us from exerting maximum efforts in pursuing nonconventional sources of energy. We are hopeful that the rest of the world will see the value in such a strategy,” he said.
The President explained that these efforts are even more crucial, in light of the realization of the Asean Economic Community, expected to take place further this year. He noted that Asean remains a formidable economic force, adding that at a time where many countries in the world are experiencing economic uncertainty, it has remained one of the world’s fastest-growing regions.
“On top of this, one must consider its size: If Asean were just one country, it would be a $2.4-trillion economy. This is precisely why, as Asean integration takes full effect, the Philippines is taking every possible measure to take on a more dynamic economic role in the region,” he said.
Mr. Aquino reported that he had already signed crucial laws that will enable the Philippines to “meet our financial integration commitments, including an “Act Strengthening the Insurance Industry” and the “Act Allowing the Full Entry of Foreign Banks in the Philippines.” Moving forward, we will continue expanding the range of financial tools available in our country, so we can maximize the advantages of integration.”
The President also pointed out that widening the range of financial options in the country also helped another key sector: that of micro, small and medium enterprises (MSMEs), explaining that an empowered MSME sector is one of the main foundations of a healthy economy, as it “enables us to establish economic dynamos in even the most remote parts of the nation; it creates opportunities, giving our countrymen yet another path through which they can take hold of their destinies. Ultimately, it can become one of the strongest and most direct tools toward inclusive growth, and thus, we want MSMEs to take on a leading role in our country’s growth story.”
This is why, he said, “We have been working overtime to provide MSMEs the wherewithal to compete and succeed in an increasingly global market. For instance, our SME Roving Academy has conducted more than 1,871 training sessions focused on skills training, product pricing and costing, business planning, entrepreneurship development and financial management, among many others. To date, these have helped more than 85,000 potential and established entrepreneurs.”
President Aquino lamented that “there has been so much good news these past few years, and yet, this good news has often been relegated to the back pages of our broadsheets,” he told guests at the forum. “I must admit: Our campaign to change the mind-set that negativism sells is still a work in progress.”
Admitting that his administration had its share of setbacks and challenges, Mr. Aquino asserted, “we also have an impressive number of achievements under our belt. This is why I have made it a point to spread the good news, and why I am always thankful for those who stay balanced and constructive: pointing out areas in which we can improve, while also acknowledging our progress.”
For instance, he recalled that 2014 was “indeed, a banner year for net FDI [foreign direct investments], reaching an all-time high of $6.2 billion, 65.9 percent higher than what we received in 2013.”
“We have, likewise, posted impressive growth: from 2010 to 2013, the Philippines averaged a GDP growth of 6.3 percent,” he said, adding: “Compare this to the previous three-year period, under my predecessor, where growth was just at 4.3 percent. On top of this: in spite of the lingering effects of Typhoon Haiyan and the uncertainty in the global economy, our country still posted a respectable 6.1-percent GDP growth figure last year.”
According to Mr. Aquino, the Philippines was upgraded to investment grade by all three major credit-rating agencies in 2013, and has continued to receive upgrades since. “We are, indeed, making history. All these, and many other factors, have led to even greater optimism for our country’s prospects.”
The President also cited a recent Bloomberg report which, he said, noted that “the Philippines is forecasted to be the world’s second-fastest-growing economy in 2015.”
“The tremendous amount of confidence the global community has developed for the Philippines is incredibly gratifying, especially considering that, not too long ago, we were known as the ‘Sick Man of Asia.’ However, our administration remains hard at work so that we can maximize every opportunity available to us, and I think many of you will agree with me when I say: You ain’t seen nothing yet,” President Aquino added.
Business Mirror, 24 March 2015
By Butch Fernandez
