The World Bank (WB) has approved a new $750-million development policy loan aimed at helping the Philippine government ramp up its digital transformation efforts, marking its second financial aid of this type to a country where the internet economy has seen rapid expansion.
The multilateral lender said on Wednesday that its second digital transformation package would help the government lower barriers to entry and bring investments to the broadband sector, promoting competition and improving connectivity.
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It added that it would also support government agencies to “adapt to a dynamic legal and regulatory environment, boosting efficiency and transparency through digital technologies.”
Further, it said the multimillion-dollar loan would support financial inclusion by promoting secure digital financial services, enhancing transparency and customer protection, and improving payments infrastructure.
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Lastly, it said the loan would improve trust in e-commerce, expand logistics, create jobs in digital services and enhance the country’s competitiveness in the digital sector.
“Digitalization is a transformative force that can drive productivity-led growth and enhance the efficiency of critical services such as transport, health care, education, energy and agriculture in the Philippines,” WB country director for the Philippines, Malaysia and Brunei Zafer Mustafaoglu said in a statement.
Internet economy booming
“By leveraging digital platforms, the country can bridge gaps in service delivery, make sure that individuals and firms have access to affordable financial services and digital solutions that meet their needs, and build resilience against future crises and shocks,” he added.
In September 2023, the WB approved its first digital transformation development policy loan to the Philippines amounting to $600 million.
The Philippine internet economy has been growing rapidly in the last few years, registering the highest rate of expansion among six Southeast Asian economies, according to the latest report from Google, Temasek and Bain & Company.
In their 2024 e-Conomy SEA report, the Philippines’ overall digital economy, measured in terms of gross merchandise value, grew by 20 percent to $31 billion. The same report also showed that e-commerce sales in the country grew by 23 percent to $21 billion.