Government needs P5.7 T for infra development – USAID

MANILA, Philippines - The national government would need to invest at least P5.7 trillion to continue improving the country’s infrastructure in the next six years.

Enrico Basilio, chief of party of the USAID Advancing Philippine Competitiveness (COMPETE) Project, said the amount covering years 2017 to 2022 is necessary to sustain a public spending on infrastructure that accounts to at least five percent of the country’s gross domestic product (GDP).

“The next administration should continue this rate to sustain the country’s growth momentum,” Basilio said.

The Aquino government is ramping up public spending on infrastructure behind underspending concerns in recent years.

According to Basilio, spending on infrastructure accounts to less than three percent of GDP when the Aquino administration started.

As shown in the draft National Logistics Masterplan presented by the Department of Trade and Industry (DTI) and USAID yesterday, about P1.85 trillion of the P5.7 trillion estimated spending should go to the development of logistics infrastructure while the remaining are for other infrastructure projects such as flood control, power and water.

Among the logistics infrastructure, development of local roads is expected to cost P706 billion while public private partnership (PPP) expressway projects are seen requiring P752 billion.

Development of PPP airport projects, meanwhile, is estimated to cost P180 billion, while rail and port projects will require P133 billion and P80 billion, respectively.

The National Logistics Masterplan is aimed at addressing issues and concerns that greatly affect the competitiveness of the Philippine logistics industry, including lack of infrastructure and bottlenecks.

The proposed masterplan contains specific recommendations on the improvements of existing infrastructure to support the demand of the growing logistics sectors, reforms on certain customs and tariff rules, and proposed policies that foster the development of the logistics industry.

According to the DTI, the Philippines is one of the countries that has a very least competitive logistics sector in Southeast Asia.

Citing a Transport Intelligence Report 2015, the draft masterplan said the Philippine logistics business is estimated to be worth more than P100 billion and expected to reach between P204 billion to P326 billion by 2020.