Promise of infra projects
President Duterte’s economic managers disclosed recently the administration’s plan to engage in massive infrastructure projects to promote regional development and achieve inclusive growth.
According to Budget and Management Secretary Benjamin Diokno, P8.2 trillion will be allocated to fund the “golden age of infrastructure” in the country.
These projects include Mindanao-wide rail and highway networks, modern air and sea ports, bus rapid transit systems and roads that will connect major commercial hubs.
One word best describes these plans: Impressive! If they come to fruition, they will generate millions of jobs, spur economic growth and reduce the national poverty level.
But wait, isn’t this the same tune, except for the lyrics, that was heard from then President Benigno Aquino when he took over the reins of government six years ago? He announced plans to, among others, modernize regional airports, improve and construct mass transport facilities, and build road networks.
Out of the 12 projects approved under the Aquino administration, only three were completed. The rest are either scheduled for bidding or under review.
Several reasons have been cited for the failure of these projects to take off, namely, right-of-way issues, restraining orders issued by the courts and inefficiency of the departments tasked with supervising their construction.
There were also reports that the staff assigned to prepare the projects’ terms of reference and evaluate the bids “over analyzed” them and spent a lot of time covering their backs to avoid possible accusation of violation of the procurement laws.
This time, the new kids on the block have promised they will do a better job than the past administration. The initial proof of such difference is the speed by which the National Economic and Development Authority was able to get approval from the President of additional infrastructure projects.
Assuming that the technical issues have already been resolved, the next area of concern is where to source the money, or P8.2 trillion, needed to defray the projects’ costs.
Although several domestic and foreign private companies have expressed interest in entering into public-private partnership or build-operate-and-transfer arrangements, they cannot be expected to solely shoulder the financial requirements of these projects.
The government would have to pay for certain portions of the projects, say, right-of-way acquisition or compensation for the expropriation of private property. This would require the allocation of billions of pesos in taxpayers’ money.
The administration banks on the additional revenues that are expected to be generated from the proposed amendments of the Tax Code. But the problem is, Congress does not have a reputation for efficiency or quick action when it comes to enactment of revenue raising measures.
Besides, our lawmakers are prone to succumbing to pressure from business groups when the latter’s interests are threatened by tax regulations that may reduce their profits.
In the event Congress does the administration’s biddings, revenue surge will happen only after two to four years. There is no assurance though that the extra money will not be diverted to other “projects” that may catch the fancy of the lawmakers.
The availability of funds will not automatically translate to the prompt commencement of the projects and their scheduled completion.
Bear in mind that the problems that prevented the Aquino administration from accomplishing, or starting, its promised projects are still very much in place.
The rules on right-of-way acquisition have not changed. Outside of admonishing the courts from issuing restraining orders on infrastructure projects, nothing has been heard from the Supreme Court on this problem.
The people who dragged their feet in the implementation of the abortive projects have remained in their posts and there is little likelihood that the change in administration will make them more efficient or responsive to the needs of the times.
The economic managers of the Duterte administration cannot be faulted for their exuberance about their plans for inclusive growth. But promises are not self-fulfilling.
Hopefully, they will be able to match their words with action, and that task is not easy.
