THE national government intends to raise public infrastructure spending to 6 percent of GDP by 2028, according to the Philippine Development Plan (PDP).
Based on the targets set in the country’s medium-term socioeconomic blueprint, the administration aims to spend 5.2 percent of GDP on infrastructure this year; 5.1 percent of GDP in 2024; 5 percent of GDP in 2025 and 2026; and 5.4 percent of GDP in 2027.
However, in the first five years of the plan, the targets for infrastructure spending are lower than the 5.9 percent of GDP average recorded in the first three quarters of last year.
“Over the next Plan implementation period, annual spending on infrastructure will be sustained at 5 percent to 6 percent of GDP. In line with this, the government will continue to tap viable funding mechanisms to augment the public resources in financing critical infrastructure projects,” the PDP stated.
Per the PDP, tapping more public private partnerships (PPP) will help the national government obtain access to efficiency, greater resources, expertise, and innovations that would not be readily available and accessible for the public sector.
“The government can reinvigorate PPPs in financing priority infrastructure
projects. This will ensure the sustainability of operations of infrastructure facilities and free up fiscal space for other social programs and development priorities,” it added.
The national government also intends to ensure that the additional resources of Local Government Units (LGUs) through the Mandanas-Garcia ruling would be maximized and also used for infrastructure development at the local level.
In turn, the national government intends to provide technical assistance and set service delivery standards for LGUs to help them undertake these projects.
The national government and LGUs will also explore cost-sharing arrangements in the implementation of devolved infrastructure projects. Under the PDP, the LGUs’ capacity to prepare and structure PPPs will also be improved.
“The government will continue to strategically engage multilateral and bilateral development partners for external financing to capitalize on their comparative advantages and benefit from knowledge and technology transfers,” the PDP added.
In the PDP, annual public infrastructure spending in 2017–2021 ranged from 4.2 percent to 5.8 percent of GDP. This is approximately twice as much as the average spending over the previous five decades.