IMF urges PH to address public infra woes

THE PHILIPPINES must increase public infrastructure spending to be able to reach its maximum economic growth potential, according to an International Monetary Fund (IMF) working paper released Tuesday.

The IMF said the country needed to sustain initiatives under its comprehensive tax reform program in order to boost spending for developmental projects.

“The Philippines’ public infrastructure is below that in the neighboring countries. Persistently low public investment in the Philippines has resulted in a low public capital stock relative to its neighbors,” read the paper titled “Improving Public Infrastructure in the Philippines.” The government’s investment in infrastructure, at 21.8 percent of the gross domestic product (GDP) in 2014, was “well below” the Philippines’ regional peers, data showed.

The country’s economy grew by an average of 6.2 percent during the first five years of the Aquino administration, the fastest rate since the late 1970s. The paper pointed out, however, “the low revenue base and fiscal consolidation have prevented sufficient resource allocation for public investment in the past, while weak implementation capacity has led to budget under-execution more recently.”