MANILA, Philippines – While the Philippines is on track to meeting economic targets, it is falling behind on its desired social outcomes.

The country has received much praise with respect to its economic growth, achieving its economic targets so far as outlined by the Philippine Development Plan (PDP) from 2011-2016. (READ: PH grows 7.2% in 2013, above gov’t target)

Hailed as one of the region’s best performers and having won investment grade status for the first time, the Philippines has seen increases in global rankings.

Yet despite its stellar economic accomplishments, the country is off target in terms of its social development goals.

According to Economic Planning Secretary and National Economic and Development Authority (NEDA) Director-General Arsenio Balisacan, “the poorest families are being left behind,” despite cities’ or provinces’ economic growth. (READ: PH poverty almost unchanged since 2006)

The government has two years left of its 5-year plan. On Monday, February 17, it unveiled its updated mid-term plan.

“Substantially bringing down poverty takes a long time, as experiences of other countries have shown. In the case of the Philippines, there is the added challenge of geoclimatic shocks,” he said.

“We believe that the key is to directly address the constraints faced by the poor, set against a backdrop of rapid and sustained growth. These constraints operate in a highly diverse, fragmented and hazard prone environment.”

He added, “the ultimate goal of the updated plan is inclusive growth… in addition, we are committing to quality of life targets: raise the quality of employment and overall quality of life.”

Balisacan said these goals will be measured by the government in terms of the following achievements:

• economic growth of an average of 7-8% until 2016
• reduction in unemployment rate to 6.5-6.7% by 2016
• reduction in incidence of income poverty to 18-20%
• reduction in underemployment to 17% in 2016
• reduction in incidence of multidimensional poverty incidence (which looks at health, education, access to water, sanitation, secure housing, etc.) to 16-18%

Even the investment to gross domestic product ratio of 21.1% in 2013, which is not far from the PDP goal of 22% by 2016, is not enough, said Balisacan – since it is still far below what ASEAN neighbors have.

To accomplish these goals, Balisacan said the government has zeroed in on the country’s poorest communities, and will target them with direct poverty reduction programs, which he said will hasten development.

The plan

Below are the government’s plans for the following challenges.

For job creation and to sustain economic growth:

• macroeconomic satiability, strong financial system, healthy external sector to maintain positive expectations of consumers and business sectors
• raise productivity and sustain growth in agriculture, industry and services sectors
• invest in reach and development
• focus on income diversification and agriculture and industry linkages
• reduce cost of doing business in country by addressing infrastructure bottlenecks, improving connectivity and increasing the availability of highly trainable and skilled labor

For Category 1 provinces with high numbers of poor, but low incidence of poverty (Zamboanga del Sur, Cebu, Pangasinan, Negros Occidental, Camarines Sur, Leyte, Iloilo, Sulu, Quezon, Davao del Sur):

• improve skill sets of poorest families and undertake more aggressive employment facilitation for better job-skills match 
• identify and help poorest households by name known as “narrow targeting,” by using data from the National Household Targeting System
• increase growth and employment opportunities in these provinces starting with the growth sectors present in these provinces, then focus on providing auxiliary and ancillary services (could be IT-Business Process Management, tourism, construction, manufacturing, and logistics)

For Category 2 provinces, which are sparsely populated and remotely located, and confronted with weather disturbances and armed conflict with very high proportion of the population who are poor (Lanao del Sur, Maguindanao, Eastern Samar, Apayao, Zamboanga del Norte, Camiguin, Saranggani, North Cotabato, Masbate, Northern Samar):

• provision of basic social services that promote economic and physical mobility partnered with opportunities
• increasing small businesses that are agriculture-based and are more connected to service providers – in areas where there is armed conflict, peace-building efforts

For Category 3 provinces prone to multiple hazards, such as landslides and flooding where the marginally non-poor people can quickly slide into poverty due to shocks or natural disasters:

• make them resilient especially to the impact of natural disasters by updating the geohazard maps, land use plans and local development plans
• train residents on disaster response
• construct resilient structures that could serve as evacuation centers

Aside from these, Balisacan acknowledged “that the overall development of the country is ultimately a product of the dynamism of the private sector.”

“The role of government is to set the necessary policy and regulatory framework and provide public goods and services to catalyze private initiative and encourage efficiency improvements,” he said.

“The plan emphasizes the government’s facilitative role in promoting competition and making it easy for firms and entrepreneurs, regardless of size, to do business in the country. At the same time, government will intervene strategically where the private sector cannot be relied upon to deliver the goods, services and facilities needed by the poor and marginalized.”

Lessons

Balisacan said the government’s roadmap is based on the lessons it learned from the first 3 years of the PDP’s implementation.

“First, good governance is an effective platform upon which strategies should be implemented. Second, macroeconomic and political stability fuels positive expectations that lead to growth. Third, economic growth is necessary but not sufficient for poverty reduction. Fourth, development strategies need to have spatial and sectoral dimensions to ensure inclusive growth. Lastly, disasters can negate the gains and even push back development,” he said.

The Aquino administration hopes that its updated plan will help it achieve its social targets, which would pave the way for it to meet the Millennium Development Goals.

“What we want to do and what we are proposing to achieve here is to ensure that the rapid economic growth that we have been achieving will redound to quicker and faster poverty reduction,” he said.

“And that we will do by way of the programs that we have outlined, and that is by giving direct focus on where the poor are – in terms of the space, the geography, and the sectors in which they belong – and tailor the response to poverty on the basis of the circumstances of these areas, the regions, the provinces, the cities, and the poor.” – Rappler.com