To my fellow Cabinet members, DTI Secretary Alfred Pascual and DICT Secretary Ivan John Uy; Representative Anna Veloso Tuazon; ULI Philippines Chairperson Jean (JEEN) de Castro and the rest of the ULI Philippines team; our partners in nation building from the private sector; and to our participants, a pleasant morning to all.
Assalamu alaikum wa Raḥmatullahi wa Barakatuh.
First, I would like to thank the Philippine National Council of the Urban Land Institute for inviting the Department of Budget and Management to be part of a very promising conference which aims to explore how different sectors of our society can work better in unity towards a new era of Philippine development.
The topic of your conference—Digital and Physical Infrastructure—is aligned with the priority thrust of the Marcos Jr. Administration to develop infrastructure as one of the country’s main drivers for growth.
To ensure that we do not neglect socioeconomic objectives even as we achieve high-growth economic performance and meet the targets of the Medium-Term Fiscal Framework, the Administration’s priorities have been aligned with the 8-point Socioeconomic Agenda and the Philippine Development Plan (PDP) 2023 to 2028, which include as objectives food security, improved transportation, affordable and clean energy, enhanced health care and social services, safe face-to-face education, sound fiscal management, and bureaucratic efficiency.
Our National Budget is aligned with these objectives. Thus, the Social Services sector—comprising Education and Health—has been given the highest budget allocation with Php 2.0 trillion or 38.0 percent of the FY 2023 National Budget.
Meanwhile, the Economic Services sector has been given the second highest share with Php 1.62 trillion or 30.8 percent, as the government continues to push for infrastructure development.
We will continue the Build, Build, Build program of the previous administration. As you know, we are now calling it Build, Better, More—or BBM—and we have allocated Php 1.3 trillion in the National Budget to sustain the momentum of the public infrastructure boom.
Towards this end, infrastructure disbursements will be maintained between 5.0 to 6.0 percent of the GDP in the medium term, reaching Php 2.3 trillion by 2028.
Infrastructure investment priorities include improving the access of the poor to basic services, public transportation, strengthening industry linkages, expanding both physical and digital connectivity, providing affordable and secure energy, and flood protection infrastructure.
The bulk of the infrastructure budget is intended for the development of physical infrastructures. This includes Php 478.7 billion for roads, Php 283.2 billion for flood control infrastructures, Php 164.1 billion for local infrastructure development, Php 48.1 billion for buildings, and Php 40.1 billion for railways.
For social infrastructure development, some Php 29.2 billion has been allocated for school buildings, Php 16.7 billion for water supply systems, Php 14.4 billion for hospital and health centers, Php 3.7 billion for power supply systems, and Php 2.5 billion for housing and community facilities. Similarly, Php 30.1 billion was allocated for irrigation systems while Php 1.2 billion was set aside for reforestation projects.
I am also happy to share that just this month, the NEDA Board, chaired by the President, approved 194 high-impact and urgently-needed infrastructure flagship projects. These projects amount to Php 9 trillion, which shall be given budget priority in the national budget over the medium term.
We are also keen on improving our digital infrastructure. In the fourth quarter of 2022, the Information and Communications Technology or ICT industry received the biggest bulk of foreign investments amounting to Php 114.29 billion. To continue harnessing the potential of a digital economy and achieve universal connectivity, we have also allocated Php 24.13 billion for digital infrastructures in the country.
Finally, in line with our commitment to sustainability and in response to the growing demand for green investments, we have in the pipeline infrastructure investment opportunities that align with internationally accepted definitions of green investments.
To help finance all these, the Marcos Jr. Administration will utilize Public-Private Partnerships or PPPs. We recognize the important contributions of the private sector not only in bridging the infrastructure gap, but also in implementing and innovating climate change solutions, so we are working on the provision of legal and regulatory support to PPPs and the development of local PPP projects in priority sectors.
In addition, we are currently exploring the establishment of the Philippines' very first sovereign wealth fund. This has already been given the green light by the House of Representatives and has just been sponsored by Senator Mark Villar, Chairperson of the Senate Committee on Banks, Financial Institutions, and Currencies, last March 20. As a tried and tested global investment vehicle, this will give the Philippine economy the momentum to move forward.
Alongside these initiatives, we also have legislative reforms to promote transparency, efficiency, and responsiveness in public service, with the end in mind of fostering a conducive business environment and investment climate in the Philippines, as stated in our Philippine Development Plan 2023-2028.
These include the Progressive Budgeting for Better and Modernized or PBBM Governance Bill, which aims to streamline the processes of delivering programs and services across all government offices through digitalization.
We are also looking into the amendment of the Government Procurement Reform Act, which was passed twenty years ago or in 2003. Last October, I met with officials of the World Bank who have expressed their willingness to provide technical support as we study possible improvements in the law.
In the meantime, as we wait for these laws to be passed, we are doing our part to begin the transformation towards a more transparent and efficient government. We will be launching our Digital Transformation Roadmap which promotes data governance and digitalization in fiscal-related government processes. I really believe that we need to fully embrace and transition to digitalization, especially for government processes.
Given the elimination of regulatory and institutional obstructions, and the ramping up of technology adoption, we hope for your continued support so that together, we can realize our Medium-Term Fiscal Framework Infrastructure goals towards a truly inclusive, sustainable, and prosperous economy.
Thank you very much. Wabillahi Tawfiq Wal Hidaya, Wasalamu alaikum wa rahmatullahi wa Barakatuhu.
Maraming salamat po.
