Connect with us

Hi, what are you looking for?

Economy

Efficient spending seen needed to plug infrastructure gap

ADDRESSING the Philippines’ infrastructure shortcomings will require more efficient åment of rigid institutional processes to clear up the project pipeline, ANZ Research said.

“Based on past trends, the Philippines lags in efficient public investment. We are hopeful though that the presidential elections next year and the current slow growth trajectory will push the government to improve the efficacy of the investment management process,” ANZ Research Chief Economist for Southeast Asia and India Sanjay Mathur and economist Kanika Bhatnagar said in a note.

ANZ Research compared the Philippine infrastructure gap to those of India and Indonesia, which have inherent “institutional rigidities” obstructing public investment.

“What is less understood is that these shortcomings can be overcome not just by spending more on infrastructure but also making spending more efficient so that delays and cost overruns are minimized,” they said.

In 2020, infrastructure spending declined 22.7% to P681 billion, according to preliminary data from the Department of Budget and Management. Actual spending that year exceeded the downgraded target by 12%.

This year, the government hopes to spend P1.169 trillion on infrastructure, or about 5.9% of the economy. Another P1.154 trillion is targeted for the sector in 2022.

Economic managers are hoping the infrastructure push will accelerate the recovery through job creation.

“This is an opportune time to hike infrastructure spending. Large output gaps and low interest rates imply that such spending will not crowd out private spending and may even support it,” Mr. Mathur and Ms. Bhatnagar said.

“The challenge is not only to increase infrastructure investment but also its efficacy so that trend GDP (gross domestic product) growth improves,” they added.

In 2020, the Philippine economy contracted 9.5%. Economic managers expect it to bounce back this year with growth of between 6.5% and 7.5%. — Luz Wendy T. Noble

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

KAI Sotto has taken his talents from Australia to Japan to play for the Hiroshima Dragonflies. The Dragonflies yesterday announced the signing of the...

Economy

AFTER a 17-year wait, Grandmaster (GM) Darwin Laylo is back on top as the country’s top chess player. The 42-year-old Mr. Laylo recalled the...

Economy

PHILIPPINE pool queen Rubilen Amit is far from calling it a career. But when the time comes, she hopes to leave a legacy not...

Economy

CAVITE Governor Jonvic Remulla will take the place of Samahang Basketbol ng Pilipinas (SBP) President Al Panlilio as the country’s chef-de-mission (CDM) to next...

Economy

THE PREMIER League (PL) has referred Manchester City to an independent commission over more than 100 alleged breaches of finance rules since the club...

Economy

PHOENIX Suns President and CEO Jason Rowley resigned Monday, hours before the team’s sale was officially approved by the National Basketball Association (NBA) Board...

You May Also Like

Investing

Browsing history makes referring to sites and pages you’ve visited in the past seamless. It’ll help you recall what page you checked out on...

Investing

The minute that any question pops into your head, you can simply ask Google. No longer do we have to pour over books and...

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Investing

Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.