5 ways to create more inclusive growth in the Philippines

While the Philippines has mostly shown impressive GDP growth figures over the past decade, many Filipinos did not share in this growth as much as they should have. These inclusivity issues are also further compounded for those living outside of major urban centers.

OFW remittances still formed a major source of income for working-class Filipinos, even as bigger local businesses recorded record profits, a sign that financial opportunities as a whole have not kept pace with the encouraging growth figures.

Another elephant in the room is regional inequity. Filipinos outside of Metro Manila and other major urban centers experience a lack of opportunity in different ways, often due to the lack of infrastructure or due to less-than-ideal management of existing resources. This cascades into a host of other serious developmental issues that have plagued the country for decades.

Thankfully, there is a lot being done to remedy the situation. National and local policymakers, as well as private partner businesses such as Aboitiz InfraCapital, are working together to close inclusivity gaps. Below are some ways a more growth-inclusive Philippines is already being created.

1) Increasing regional access to high-quality job opportunities

Regional salary rates in the Philippines are often a fraction of what they are in larger cities, and the lack of adequate infrastructure de-incentivizes local investments and entrepreneurship. This disparity often leads to a vicious cycle where regional wage-earners may find it exceedingly difficult to save or invest cash. This makes it difficult to obtain quality education or to start an enterprise with high-value labor requirements that further enrich the local economy.

The proliferation of special economic zones outside of Metro Manila has done much to break this cycle. All of Aboitiz InfraCapital’s economic estates are Philippine Economic Zone Authority developments and feature high-quality infrastructure designed to support the high-value businesses within the Estate. These zones have been a boon to local Philippine economies wherever they have been set up, increasing incomes and creating a host of economic opportunities for locals even outside of these zones.

2) Improving internet connectivity in far-flung areas

The United Nations now recognizes access to the internet as a human right. Internet access can do much to free individuals from the constraints of geography, allowing them access to global opportunities and markets.

Reliable internet connectivity via Aboitiz InfraCapital’s digital infrastructure projects has already created countless opportunities for Filipinos in historically neglected areas. Reliable rural internet access can help drive economies by allowing entrepreneurs to easily deal with customers and suppliers from all over the Philippines and the world without the need to set up shop in more expensive cities.

3) Well-managed conditional cash transfer or loan programs

According to the World Bank, the availability of cash through conditional cash transfers and similar programs can do much to prevent large swaths of society from being left far behind as a national economy soars. Such programs provide vital safety nets for the poorest of the poor, allowing them to focus on gainful employment rather than mere survival, which the World Bank suggests results in net benefit for most economies.

4) Ensuring access to clean water

Clean water is an extremely basic requirement for creating a livable environment. Without immediate access to clean, sustainable sources of water, local populations will need to spend inordinate amounts of time and money just getting clean water. This makes it difficult to set up businesses and can also expose the population to waterborne illnesses.

Aboitiz InfraCapital is doing its part to make this happen with water projects and investments all over the country. Projects run by Aboitiz InfraCapital and other like-minded organizations are doing much to create equitable access to water, closing the gap between underserved areas and more developed urban centers.

5) Championing sustainability

Sustainability means being able to ensure that future generations will enjoy the resources that the present generation has. This can be done through proper resource management.

Metro Manila, for example, faced massive dry-season water shortages before the pandemic. According to a recent study, this shortage was not due to water consumption or a lack of supply, but due to mismanagement. The resulting water shortage affected poorer residents of Metro Manila far more severely.

Moving forward, all parties involved in the management of vital resources should seriously plan for long-term needs. Local policymakers should look into best practices developed elsewhere in the country or outside and learn from them. Apo Agua, an Aboitiz InfraCapital-led bulk water supply project in Davao, for example, has done much to shift the city’s longstanding dependence on groundwater wells toward a more sustainable source—the Tamugan River.

Over the years, Aboitiz InfraCapital has worked with the national government and LGUs to create more inclusive economic opportunities for Filipinos. It will take all our efforts, but you can be sure that we have the Filipino people covered every step of the way.