The Philippines is the “most ready” among the 10 member-states of the Association of Southeast Asian Nations (ASEAN) in carrying out a massive infrastructure buildup, owing to several positive factors buttressing the economy, according to the regional development arm of the United Nations for the Asia-Pacific region.

This was revealed by the Department of Finance (DOF) in a statement released yesterday.

Gil Beltran, finance undersecretary and chief economist, said these factors cited by the UN Economic and Social Commission for Asia and the Pacific (UNESCAP) include substantial financing opportunities from the Philippines’ development partners, the government’s tax reform program and rising revenue collections, and the declining debt service ratio.

Beltran said all these factors contribute to an adequate fiscal space that would allow the country to pursue an expansionary policy on the Duterte watch.

UNESCAP, the largest UN body serving the Asia-Pacific, recently convened in Manila its Workshop on Infrastructure Financing Strategies to discuss the Philippines’ infrastructure needs and different financing modes and sources available to the country.

Beltran, who represented the DOF in the dialogue, said that besides its ample fiscal space, the workshop also cited the country’s strong financial system, which is teeming with excess liquidity, and supported by a good supervision and a rising savings rate.

“The Workshop found the Philippines to be among the most ready in Asean in boosting infrastructure development,” Beltran said in his report to Carlos Dominguez III, finance secretary.

Beltran said UNESCAP also cited the government’s strong project evaluation and prioritization system based on economic viability in undertaking infra projects, and a Right-of-Way Law or Republic Act 10752, which encourages the government and landowners to agree promptly on land transactions for infrastructure projects.

Another favorable factor cited by UNESCAP “is the country’s Public-Private Partnership (PPP) law that sets up an institution and a set of rules to implement projects in an orderly manner and a private sector that is aggressive in participating,” Beltran said.

“However, the Workshop also took note of the dearth of projects from less developed regions and scanty participation by the local government units, despite the assistance available for their PPP projects through the Municipal Development Fund Office (MDFO),” Beltran added.

Dominguez has told potential investors in the country’s Build, Build, Build infrastructure program that a sizable portion of the spending for this initiative will go to the country’s poorest provinces.

The finance chief also said the Philippines’ economic strategy takes advantage of the country’s benign debt conditions, low interest rates, investment-grade credit ratings, and improvements in the ease of doing business that the Duterte administration will continue to enhance by streamlining government operations and cutting red tape.

Dominguez said over the remaining five and a half years of the Duterte administration, it has programmed over $170 billion in infrastructure spending, of which $23 billion will go to the infrastructure program next year.

He noted a significant portion of the programmed funds will be drawn from official development assistance lending which, on the average, carries interest charges a full percentage point below the best that the commercial markets can offer.

By ANGELA CELIS