Finance Secretary Benjamin Diokno has highlighted the imperative need for innovative financing solutions to support both physical and digital connectivity projects.
Diokno’s remarks were made during the 2023 Asian Infrastructure Investment Bank Annual Meeting, which took place in Egypt.
During the panel discussion, Diokno discussed the challenges to connectivity arising from years of infrastructure underinvestment in the Philippines.
He cited data from 2001 to 2015 when the country allocated a mere average of two percent of its gross domestic product (GDP) to infrastructure development during that period.
To ensure adequate financing, the government has embarked on comprehensive tax system reforms and pledged to sustain spending levels at five to six percent of GDP throughout the six-year term of the current administration.
In addition to implementing essential policy measures, Diokno underscored the vital role of bilateral and multilateral development partners, saying that a substantial portion of the infrastructure flagship project (IFP) list is currently under consideration for official development assistance financing support.
These projects encompass both physical and digital connectivity, representing a cumulative investment requirement of P4.68 trillion for 80 IFPs.
Diokno also emphasized the importance of ensuring the successful and high-quality execution of infrastructure projects.
To achieve this objective, the Philippines is actively adopting risk management solutions and enacting policy reforms through a holistic, government-wide approach.
Furthermore, the country is taking significant strides toward bolstering connectivity by embracing greater digital technology adoption. A noteworthy initiative is the Philippines’ venture into its inaugural Digital Transformation Development Policy Loan.
This transformative program, co-financed by a $600 million loan from the World Bank – International Bank for Reconstruction and Development, aims to digitize government systems to enhance service delivery, expand financial inclusion through widespread digital payment adoption, and drive business growth in the digital services sector.