ADB Projects in Shrinking Democratic Spaces
The Asian Development Bank (ADB) and the Philippines have been working together since five decades ago, with the headquarters of the Bank given a home in Manila. Today, the ADB is one of the largest official development assistance (ODA) partners of the Philippines. As of April 2018, the Philippines has received more than USD16 Billion from the ADB in the form of loans and grants. Around USD1 Billion more have been released to private Philippine companies also in the form of loans and investments.
According to the ADB, the Philippines is entering the “golden age for economic growth”. Over the next decade, the government is set to embark on an ambitious USD180-billion infrastructure spending dubbed as the “Build Build Build” program, which is said to transform the Philippines’ economy. According to the Department of Finance (DOF), the government is looking at 75 flagship projects, which are all large-scale infrastructure projects. These include: six airports, nine railways, three bus rapid transits, 32 roads and bridges, and four seaports.
During a loan signing at the ADB in January of this year, the Department of Public Works and Highways (DPWH) said, “2017 was a very aggressive year, but we can expect more projects to be online in 2018.” According to the DOF, 15 projects totalling 1.18 trillion pesos are already in pre-construction stages. And the bulk of these projects will be funded by foreign loans.
Duterte’s Build, Build, Build flagship project is expected to widen the trade deficit that reached a record high in November 2017. Moreover, according to economists, as construction picks up, steel and machinery imports are likely to grow. This can then put pressure on the value of the Phlippine peso, which is reaching its highest levels in a decade, according to Japanese news agency Nikkei.
Another notable trend is the country’s growing debt, which amounts to PHP6.89 Trillion (roughly USD131 Billion) as of March 2018. This is a staggering increase of 11% from last year.
Governance and democracy
The political, social and governance challenges the country is facing likewise needs a critical examination. According to international economic experts, the country’s biggest problem may not be debt but rather the government’s ability to get things moving cleanly. As reported by Nikkei, investors still complain of red tape and corruption.
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