Philippine Development Plan 2023-2028 PDF

Philippine Development Plan 2023-2028 Table of Contents Foreword xiv Preface xvi Acknowledgement...

Philippine Development Plan 2023-2028 Table of Contents Foreword xiv Preface xvi Acknowledgement xix PART I: INTRODUCTION 1 Chapter 1 | A Plan for Economic and Social Transformation 5 Health and Social Trends 9 Economic Trends 10 Geopolitical Trends 11 Environmental Trends 12 Technology and Regulations 12 Overview of the Philippine Development Plan 2023-2028  14 PART II: DEVELOP AND PROTECT CAPABILITIES OF INDIVIDUALS AND FAMILIES 27 Chapter 2 | Promote Human and Social Development 31 Subchapter 2.1 Boost Health 31 Assessment and Challenges  32 Strategy Framework 35 Strategies  36 Outcome 1: Social determinants of health improved 36 Outcome 2: Healthy choices and behavior enabled 36 Outcome 3: Access, quality, and efficiency of health care improved 37 Outcome 4: Health systems strengthened 39 Legislative Agenda 41 Results Matrix  42 Subchapter 2.2 Improve Education and Lifelong Learning 46 Assessment and Challenges 46 Strategy Framework 47 Strategies 48 Outcome 1: Quality, inclusive, adaptive, resilient, and future-ready basic education for all achieved 48 Outcome 2: Globally competitive and inclusive TVET and higher education, and improved research output attained for a broader knowledge economy 50  Outcome 3: Governance for human capital development improved 52 Legislative Agenda 54 Results Matrix  55 Subchapter 2.3 Establish Livable Communities  57 Assessment and Challenges 57 Strategy Framework  60 Strategies  61 Outcome 1: Social environment promoted 61 Outcome 2: Environmental quality improved 62 Outcome 3: Built environment upgraded 64 Outcome 4: Responsive governance advanced 67 Legislative Agenda 69 Chapter 3 | Reduce Vulnerabilities and Protect Purchasing Power 77 Subchapter 3.1 Ensure Food Security and Proper Nutrition 77 Assessment and Challenges 77 Strategy Framework  80 Strategies 80 Outcome 1: Sufficient and stable supply of food commodities attained 80 Outcome 2: Access of consumers to affordable, safe, and nutritious food expanded 82 Outcome 3: Nutrition across all ages improved 84 Legislative Agenda  86 Results Matrix  87 Subchapter 3.2 Strengthen Social Protection 88 Assessment and Challenges 88 Strategy Framework 91 Strategies 92 Outcome 1: A universal, modern, and integrated social protection system achieved 92 Outcome 2: Individual and life cycle risks mitigated 94 Outcome 3: Economic risks managed 96 Outcome 4: Natural, health, climate, and other human-induced hazards mitigated 96 Outcome 5: Governance and political risks addressed 98 Legislative Agenda 98 Results Matrix 99 Chapter 4 | Increase Income-earning Ability 105 Assessment and Challenges 105 Strategy Framework 107  Strategies  107 Outcome 1: Employability increased 107 Outcome 2: Access to employment opportunities expanded 111 Outcome 3: Shared labor market governance achieved 114 Legislative Agenda 117 Results Matrix 117 PART III: TRANSFORM PRODUCTION SECTORS TO GENERATE MORE QUALITY JOBS AND COMPETITIVE PRODUCTS 121 Chapter 5 | Modernize Agriculture and Agribusiness 125 Assessment and Challenges 125 Strategy Framework  129 Strategies  129 Outcome 1: Efficiency of AFF production enhanced 129 Outcome 2: Access to markets and AFF-based enterprises expanded 131 Outcome 3: Resilience of AFF value chains improved 133 Outcome 4: Agricultural institutions strengthened 135 Legislative Agenda  136 Results Matrix  137 Chapter 6 | Revitalize Industry 143 Assessment and Challenges 143 Strategy Framework 145 Strategies 146 Outcome 1: Domestic market production and supplier base expanded 146 Outcome 2: Moving up the value chain achieved 149 Outcome 3: Inter-sectoral linkages enhanced 156 Legislative Agenda 159 Results Matrix 160 Chapter 7 | Reinvigorate Services 167 Assessment and Challenges 167 Strategy Framework 169 Strategies 170 Outcome 1: Market expansion achieved 170 Outcome 2: Creativity and innovation in services value proposition strengthened 173 Outcome 3: Inter-sectoral linkages enhanced 176 Legislative Agenda  178 Results Matrix 179 Chapter 8 | Advance Research and Development, Technology, and Innovation 185 Assessment and Challenges 185 Strategy Framework 187 Strategies 188 Outcome 1: Basic R&D and knowledge creation strengthened 188 Outcome 2: Market-driven and customer-centered research and development advanced 189 Outcome 3: Technology extension, adoption, utilization, and commercialization scaled-up 191 Outcome 4: Innovation and entrepreneurship accelerated 192 Legislative Agenda 194 Results Matrix 195 Chapter 9 | Promote Trade and Investments 201 Assessment and Challenges 201 Strategy Framework 204 Strategies 205 Outcome 1: Global position of Philippine export sectors restored, sustained, and strengthened 205 Outcome 2: Total investments increased and targeted to boost trade, skills upgrading, and sustainability 208 Legislative Agenda 210 Results Matrix  211 Chapter 10 | Promote Competition and Improve Regulatory Efficiency 217 Assessment and Challenges  217 Strategy Framework 221 Strategies 222 Outcome 1: Anti-competitive practices diminished 222 Outcome 2: Barriers to entry and re-entry reduced 224 Outcome 3: Burden of regulation reduced 225 Cross-Cutting Strategies 227 Legislative Agenda  231 Results Matrix  232 PART IV: ENABLING ENVIRONMENT 235 Chapter 11 | Ensure Macroeconomic Stability and Expand Inclusive and Innovative Finance 239 Subchapter 11.1 Promote an Inclusive, Innovative, and Healthy Financial Sector 239 Assessment and Challenges  239  Strategy Framework  242 Strategies 243 Outcome 1: Financial inclusion broadened and deepened 243 Outcome 2: Financial innovation accelerated and strengthened 244 Outcome 3: Financial sector health ensured 246 Cross-Cutting strategies 246 Legislative Agenda 249 Results Matrix  250 Subchapter 11.2 Ensure Sound Fiscal Management and Improve the Tax Regime 251 Assessment and Challenges 251 Strategy Framework  252 Strategies 253 Outcome 1: A productive, equitable, and simple tax system established and other sources of revenues mobilized 253 Outcome 2: An efficient and inclusive budget system implemented 256 Outcome 3: Local government finance strengthened 257 Outcome 4: Sustainable management of debt ensured 258 Legislative Agenda 259 Results Matrix 260 Chapter 12 | Expand and Upgrade Infrastructure 265 Assessment 265 Connectivity  265 Water Resources 268 Energy 269 Social Infrastructure 272 Challenges 273 Connectivity 274 Water Resources  276 Energy 277 Social Infrastructure 278 Strategy Framework 279 Strategies  280 Outcome 1: Planning, programming, and asset management in infrastructure enhanced  280 Connectivity  281 Outcome 2: Seamless and inclusive connectivity via local and international linkages achieved 281  Water Resources  285 Outcome 3: Water security, ecological integrity of water systems, and resiliency to water hazards attained 285 Energy 288 Outcome 4: Affordable, accessible, reliable, and clean energy provided 288 Social Infrastructure 292 Outcome 5: Enhanced support to social development provided 292 Legislative Agenda 295 Results Matrix 297 Chapter 13 | Ensure Peace and Security and Enhance Administration of Justice 307 Subchapter 13.1 Ensure Peace and Security 307 Strategy Framework 310 Strategies 311 Outcome 1: Conflict-affected communities and conflict-vulnerable areas protected and development sustained 311 Outcome 2: Quality of life of people safeguarded from criminality 313 Outcome 3: Protection and safety from natural hazards and other security threats ensured 314 Outcome 4: Territorial integrity and sovereignty upheld and protected 315 Cross-Cutting Strategies 316 Legislative Agenda 317 Results Matrix 318 Subchapter 13.2 Enhance Administration of Justice 319 Assessment and Challenges 319 Strategy Framework 321 Strategies 322 Outcome 1: Quality and efficiency in disposition of cases improved 322 Outcome 2: Access to quality free or affordable legal services by Filipinos improved 325 Outcome 3: Quality of life of PDL improved, and productive re-integration of PDL in the community ensured 327 Legislative Agenda 328 Results Matrix 329 Chapter 14 | Practice Good Governance and Improve Bureaucratic Efficiency 337 Assessment and Challenges 337 Strategy Framework 339 Strategies 340 Outcome 1: Participatory governance deepened 340 Outcome 2: Public accountability and integrity bolstered  341  Outcome 3: Government functions, systems, and mechanisms rationalized and strengthened 343 Outcome 4: Competent, motivated, agile, and resilient public servants supported 345 Legislative Agenda  346 Results Matrix 347 Chapter 15 | Accelerate Climate Action and Strengthen Disaster Resilience 353 Strategy Framework 356 Strategies  357 Outcome 1: Climate and disaster risk resilience of communities and institutions increased  357 Outcome 2: Ecosystem resilience enhanced 359 Outcome 3: Low carbon economy transition enabled 360 Cross-cutting Strategy: Improve governance and intersectionality of climate change and natural hazard resilience 363 Legislative Agenda 365 Results Matrix  366 PART V: PLAN IMPLEMENTATION, MONITORING, AND EVALUATION 369 Chapter 16 | Plan Implementation, Monitoring, and Evaluation 373 Implementation 373 Monitoring and Evaluation 375 Evaluation Agenda for the Philippine Development Plan 2023–2028 376 Acronyms 381 Glossary 395 PDP ORGANIZATIONAL SET-UP 421 Plan Steering Committee (PSC) Members 423 Advisory Committee Members 423 Planning Committees 424 Overall Plan Secretariat 433 Drafting Team 433 NEDA Chapter Focals 434 Editorial Team 437 Production Team 437 List of Tables, Figures, Boxes CHAPTER 1 Figure 1.1 Strategy Framework of Philippine Development Plan 2023–2028 17 Table 1.1. Table of Headline Indicators  23 CHAPTER 2 Box 2.1. COVID-19 in the Philippines: Impacts and health sector challenges 34 Figure 2.1 Strategy Framework to Boost Health 35 Table 2.1.1 Legislative Agenda to Boost Health 41 Table 2.1.2 Results Matrix: Boost Health 42 Figure 2.2 Strategy Framework to Improve Education and Lifelong Learning 47 Table 2.2.1 Legislative Agenda to Ensure Lifelong Learning Opportunities for All 54 Table 2.2.2 Results Matrix: Ensure Lifelong Learning Opportunities for All 55 Figure 2.3 Strategy Framework to Establish Livable Communities 60 Box 2.3. Affordable and Secure Housing in a Livable Community: Disiplina Village, Valenzuela City 67 Table 2.3.1 Legislative Agenda to Establish Livable Communities 69 Table 2.3.2 Results Matrix: Establish Livable Communities 70 CHAPTER 3 Figure 3.1 Strategy Framework to Ensure Food Security and Proper Nutrition  80 Table 3.1.1 Legislative Agenda to Ensure Food Security and Proper Nutrition 86 Table 3.1.2 Results Matrix: Ensure Food Security and Proper Nutrition 87 Table 3.2.1 Social Protection Coverage and Expenditure in Selected Countries 89 Table 3.2.2 Estimate of social protection coverage among households in the Philippines, 2017, 2019, and 2020 89 Figure 3.2.1 Households with at least one member covered by Social Security System, Government Service Insurance System, Private Life Insurance, and/or Health Maintenance Organization per income decile (%) 90 Figure 3.2.2 Strategy Framework to Strengthen Social Protection 91 Table 3.2.3 Legislative Agenda to Strengthen Social Protection 98 Table 3.2.4 Results Matrix: Strengthening Social Protection 99 CHAPTER 4 Figure 4.1 Strategy Framework to Increase Income-earning Ability  107 Table 4.1 Legislative Agenda to Increase Income-Earning Ability 117 Table 4.2 Results Matrix: Increase the Income-Earning Ability 117 CHAPTER 5 Figure 5.1 Strategy Framework to Modernize Agriculture and Agribusiness 129 Table 5.1.1 Legislative Agenda to Modernize Agriculture and Agribusiness  136 Table 5.1.2 Results Matrix: Modernize Agriculture and Agribusiness  137 CHAPTER 6 Figure 6.1 Strategy Framework to Revitalize Industry 145 Box 6.1. Cluster-based Approach to Industrialization 157 Table 6.1 Legislative Agenda to Revitalize Industry 159 Table 6.2 Results Matrix: Revitalize Industry 160 CHAPTER 7 Figure 7.1 Strategy Framework to Reinvigorate Services 169 Table 7.1 Legislative Agenda to Reinvigorate Services 178 Table 7.2 Results Matrix: Reinvigorate Services 179 CHAPTER 8 Figure 8.1 Global Innovation Index Rank in Sub-Index Related to Knowledge Creation 186 Figure 8.2 Strategy Framework to Advance Research and Development, Technology, and Innovation 187 Box 8.1. (Pagtanaw 2050: The Philippine science, technology, innovation foresight) 189 Table 8.1 Legislative Agenda to Advance R&D, Technology, and Innovation 194 CHAPTER 9 Figure 9.1 Philippine export and foreign direct investment performance relative to the Association of Southeast Asian Nations, 2000–2020 (USD billion) 201 Figure 9.2 Philippine Product Dynamics: New Entry and Permanent Exit of Export Products, 1996–2019 203 Figure 9.3 Strategy Framework to Promote Trade and Investments 204 Table 9.1 Legislative Agenda to Promote of Trade and Investments 210 Table 9.2 Results Matrix: Promote Trade and Investments 211 CHAPTER 10 Figure 10.1 Strategy Framework to Promote Competition and Improve Regulatory Efficiency 221 Box 10.1. Whole-of-Government Approach to Competition 230 Table 10.1 Legislative Agenda to Promote Competition and Improve Regulatory Efficiency  231 Table 10.2 presents the indicators and targets during the Plan period to promote promote competition and improve regulatory efficiency. 232 Table 10.2 Results Matrix: Promote Competition and Improve Regulatory Efficiency 232 CHAPTER 11 Figure 11.1.1 Strategy Framework to Promote an Inclusive, Innovative, and Healthy Financial Sector 242 Table 11.1.1 Legislative Agenda to Promote an Inclusive, Innovative, and Healthy Financial Sector 249 Table 11.1.2 Results Matrix: Promote an Inclusive, Innovative, and Healthy Financial Sector 250 Figure 11.2.1 Strategy Framework to Ensure Sound Fiscal Management and Improve the Tax Regime 252 Table 11.2.1 Legislative Agenda to Ensure Sound Fiscal Management and Improve the Tax Regime 259 Table 11.2.2 Results Matrix: Ensure Sound Fiscal Management and Improve the Tax Regime 260 CHAPTER 12 Table 12.1 Key Economic and Energy Indicators in Select Countries 270 Figure 12.1 Strategy Framework to Expand and Upgrade Infrastructure 279 Table 12.2 Legislative Agenda to Expand and Upgrade Infrastructure 295 Table 12.3 Results Matrix: Expand and Upgrade Infrastructure 297 CHAPTER 13 Figure 13.1.1 Strategy Framework to Ensure Peace and Security 311 Table 13.1.2. Results Matrix: Ensure Peace and Security 318 Figure 13.2.1 Strategy Framework to Enhance Administration of Justice 321 Box 13.2.1 The National Justice Information System and the Criminal Justice Information Exchange 324 Table 13.2.1. Legislative Agenda to Enhance Administration of Justice 328 Table 13.2.2. Results Matrix: Enhance Administration of Justice 329 CHAPTER 14 Figure 14.1 Philippines’ Score in Selected International Governance Indices, 2011–2021 338 Figure 14.2 Strategy Framework to Practice Good Governance and Improve Bureaucratic Efficiency 339 Table 14.1 Legislative Agenda to Practice Good Governance and Improve Bureaucratic Efficiency 346 Table 14.2 Results Matrix: Practice Good Governance and Improve Bureaucratic Efficiency 347 CHAPTER 15 Figure 15.1 Strategy Framework to Accelerate Climate Action and Strengthen Disaster Resilience 357 Table 15.1 Legislative Agenda to Accelerate Climate Action and Strengthen Disaster Resilience 365 Table 15.2 Results Matrix to Accelerate Climate Action and Strengthen Disaster Resilience 366 CHAPTER 16 Table 16.1 Coordination Mechanism 374 Figure 16.1 Evaluation and the Public Sector Management Cycle  377 Foreword In my first State of the Nation Address, I tasked the National Economic and Development Authority to work with other government agencies and stakeholders in preparing the country’s development blueprint for economic transformation before the year ends. I am pleased to say that this document represents the successful and timely completion of the Philippine Development Plan (PDP) 2023 to 2028. It is a plan framed by my administration’s 8-Point Socioeconomic Agenda which seeks to address both short-term issues and medium-term constraints to growth and inclusion. This PDP is unique as the priorities and strategies were identified and crafted during a period of economic recovery, even as we navigate our way through a highly uncertain geopolitical landscape, simmering recession in major advanced economies, rapidly changing labor market conditions brought about by digitalization and automation, and increasingly volatile weather patterns due to climate change. Drawing from the lessons our country has learned, my administration has pursued a whole-of-government and whole-of-society approach to identifying the way forward. The PDP provides us a comprehensive roadmap containing actionable policies and programs, as well as legislative priorities, that will enable us to reach our desired development outcomes. The Plan calls for deep and fundamental transformations in all sectors–social, economic, institutional, and environmental–as we aim to reinvigorate job creation and accelerate poverty reduction toward a prosperous, inclusive, and resilient society. xiv | Philippine Development Plan 2023-2028 We will reduce poverty to a single-digit I invite every Filipino to share in my level by 2028. This will be realized through commitment to uplift the lives of our fellow rapid, sustained, and inclusive growth that kababayans as we work to achieve our nation’s will create more, better, and resilient jobs. collective vision of a matatag, maginhawa, at Stable prices and prudent fiscal management, panatag na buhay para sa lahat. as well as an enabling regulatory and policy environment will support our economic Ang pangarap niyo ay pangarap ko. Ito ang expansion. To achieve these outcomes, I have ating plano. issued an Executive Order to all government agencies and instrumentalities to align their Mabuhay ang Pilipinas! Mabuhay ang programs and policies with the Plan. With sambayanang Pilipino! the PDP 2023-2028, the Philippines will build back better and more. Every Filipino has a part to play in our nation’s journey to prosperity. The need for united and coordinated efforts of the public and private sectors, as well as civil society, FERDINAND R. MARCOS, JR. has grown ever more vital as we enter into President new years of post-pandemic recovery and Republic of the Philippines as global headwinds threaten to derail our progress as a people. Foreword | xv Preface The context permeating the formulation of the Marcos administration’s Philippine Development Plan (PDP) 2023-2028 is significantly and uniquely noteworthy. The Marcos administration assumed a socioeconomic landscape battered by the COVID-19 pandemic, external shocks, and natural calamities. While the economy was emerging, albeit slowly, from the economy’s unprecedentedly sharp contraction in 2020, mobility restrictions continued, fiscal space substantially eroded, and inflation was on the rise. Meanwhile, heightened uncertainty and volatility eclipsed the global economy as geopolitical tensions continued and sharp slowdowns in major economies loomed. These challenges shaped the PDP’s objectives: addressing inflation and sustaining recovery amid the external headwinds and returning the economy to its high-growth trajectory toward advancing the country’s progress in achieving the AmBisyon Natin 2040 vision of a matatag, maginhawa, at panatag na buhay for all Filipinos. Back in 2015 under the Aquino administration, the National Economic and Development Authority (NEDA) led the exercise of formulating the long-term vision through extensive public consultations, national household surveys, and technical studies on various thematic areas widely known to be critical factors influencing a country’s economic development. The aim was to find enabling and empowering anchors to successive medium-term development plans to help ensure the continuity of efforts toward the attainment of Filipinos’ aspirations to live firmly rooted, secure, and comfortable xvi | Philippine Development Plan 2023-2028 lives within a single generation. In 2016, the (Chapter 4). The Plan shall strengthen the Duterte administration, through Executive economic sectors, which are seen to create more Order 5 (s. 2016), adopted the AmBisyon and higher-quality jobs and produce globally Natin 2040 as the country’s guide for competitive products. The PDP identifies the development planning, anchoring its PDP policies, programs, and legislative priorities 2017-2022 on this national vision. required to modernize the agricultural sector (Chapter 5), revitalize industries (Chapter 6), The Marcos administration’s PDP 2023-2028 and reinvigorate services (Chapter 7). seeks to build on the significant gains the country has achieved in the past two The government’s role is critical as it must decades, mindful of some setbacks caused foster an enabling environment for social by the pandemic. Its overarching goals are and economic transformation. The PDP to reinvigorate job creation and accelerate identifies strategies for advancing research poverty reduction by transforming the and development, technology, and innovation economy and public service. The formulation (Chapter 8), promoting trade and investments of its strategies and priorities to achieve these (Chapter 9), enhancing competition goals has taken lessons from the first two and improving regulatory efficiency years of the pandemic, ideas distilled from (Chapter 10), ensuring macroeconomic development research and policy studies, and stability (Chapter 11), expanding and invaluable insights gleaned from the country’s upgrading critical infrastructure (Chapter economic history. 12), ensuring peace and security and enhancing the administration of justice What sets this PDP apart is its focus on (Chapter 13), practicing good governance and economic and social transformation improving bureaucratic efficiency (Chapter (Chapter 1). Framed by President Ferdinand 14), and accelerating climate adaptation and ‘Bongbong’ Marcos’ 8-Point Socioeconomic strengthening disaster resilience (Chapter 15). Agenda, the chapters of this Plan are organized with the underlying logic that dynamic and Interspersed between the chapters are robust institutions and a resilient environment cross-cutting strategies which include shall enable the social and production expediting digitalization, enabling the sectors to provide the services, goods, and servicification of our industries, supporting high-quality jobs that transform the quality of the creation of dynamic innovation life of the Filipino people. ecosystems, enhancing and investing in digital and physical connectivity, fostering greater The Plan seeks to develop and protect the collaboration between local and national capabilities of individuals and families governments, and facilitating stronger by promoting their human and social partnerships with the private sector. development (Chapter 2), reducing their vulnerabilities and safeguarding their Finally, the Plan identifies the metrics and purchasing power (Chapter 3), as well as mechanisms for monitoring and evaluating increasing their income-earning abilities the progress in the Plan’s implementation Preface | xvii (Chapter 16). Identified outcomes will be monitored and assessed using indicators and interim targets as identified in the accompanying Results Matrix (RM)—an instrument designed to provide results orientation to the Plan. As part of our whole-of-government and whole-of-society approach, the Plan is complemented by a set of Regional Development Plans, the Public Investment Program (PIP) for 2023-2028, and the Three-year Rolling Infrastructure Plan (TRIP) for FY 2024-2026. These will help ensure regional equity and that we have the right investments and programs in place at the right time. The PDP 2023-2028 signifies the Marcos administration’s strong commitment to steer our economy through these uncertain and challenging times. Although the journey ahead may indeed be long and painstaking, and disruptions and challenges will certainly be inevitable, what remains crucial is our steady and tireless march toward reaching ever-higher development goals as our nation makes progress in attaining its long-term vision. ARSENIO M. BALISACAN Secretary National Economic and Development Authority xviii | Philippine Development Plan 2023-2028 Acknowledgement The PDP 2023-2028 results from Annette Balaoing-Pelkmans, Alex Brillantes, systematic and extensive consultations and Jr., Gem Castillo, Lawrence Dacuycuy, collaboration with various government Mcgyver Doria, Milwida Guevara, Susan agencies, the private sector, academe, and Rachel Jose, Napoleon Juanillo, Jr., Miharu development partners. We are grateful to the Jay Kimwell, Czarina Corazon Medina-Guce, distinguished members of the PDP Advisory Gabrielle Ann Mendoza, Felino Palafox, Committee--Sabin Aboitiz, George Barcelon, Jr., Francis Mark Quimba, Eufemio Rasco, Kenneth Cobonpue, Dakila Cua, Emil Javier, Jr., Majah-Leah Ravago, Maria Cherry Lyn Jikyeong Kang, and Christopher Monterola– Rodolfo, Jennifer Santiago-Oreta, Guillermo for providing high-level policy advice and Tabios III, Marites Tiongco, and Edgar multi-sectoral insights. Richard Trono. The PDP also drew from the insights and helpful suggestions provided by Special thanks are due to the World Bank, the UN family of agencies based in Manila. particularly Country Director Ndiame Diop, who offered evidenced-based policy Of course, the timely production and notes on many thematic areas, and the publication of the PDP would not have Asian Development Bank, notably Country been possible without the selfless efforts Director Kelly Bird, as well as the USAID, of the NEDA Policy and Planning Group which mobilized experts and consultants led by Undersecretary Rosemarie Edillon to assist the NEDA team in drafting the and the NEDA Development Information Plan chapters. Staff led by Director Nerrisa Esguerra. We are also thankful to Undersecretary Carlos We are grateful to the following who Bernardo Abad Santos, Undersecretary generously shared their time and expertise Joseph Capuno, Assistant Secretary Sarah to ensure that the best versions of the Lynne Daway-Ducanes, and Supervising assessments, strategies, and indicators Officer Reynaldo Cancio, who served as contained in the Plan were completed in members of the Editorial Team. time: Clarissa David, Ronald Mendoza, Jose Gerardo Alampay, Fernando Aldaba, Preface | xix PART I Introduction 01 A Plan for Economic and Social Transformation CHAPTER 1 A Plan for Economic and Social Transformation “By 2040, the Philippines shall be a prosperous, predominantly middle-class society where no one is poor. Our peoples will enjoy long and healthy lives, are smart and innovative, and will live in a high-trust society.” AmBisyon Natin 2040 Filipinos aspire to have a life that is strongly rooted, comfortable, and secure (matatag, maginhawa, at panatag). Since the articulation of this vision in 2015, there have been improvements in key indicators, notably in the reduction of poverty incidence and increase in per capita income. However, the coronavirus disease (COVID-19) pandemic has rolled back some of these gains and revealed the fragility of these achievements. Even as the country is still in the early recovery stage from the pandemic-induced economic and social losses, and as we continue to learn to “live with the virus,” we are acutely aware that the challenges ahead have evolved and multiplied. This means that changes will have to be made to the way we do things—to how economic and social interactions and transactions are done, how public services are delivered, how rules and regulations are enforced, and so on—the so-called “new normal.” While some advantaged individuals and businesses have begun the transition to the “new normal,” many more have not. Thus, what we need is a coherent Plan for Economic and Social Transformation (henceforth, the Plan) that accelerates economic and social recovery toward inclusive and resilient prosperity. The Plan will fully consider the lessons learned from the pandemic… As we formulate the Plan for Economic Second, we learned that everything and and Social Transformation, we need to everyone are interconnected, and that there take stock of the lessons learned from our are advantages to having strong interlinkages. pandemic experience. This extends to the interdependence between the health of the economy and the state of First, maintaining robust macroeconomic its healthcare system. The Plan, therefore, fundamentals, which fosters consumer and must include strategies to strengthen these investor confidence, is key to achieving interlinkages and make them robust. rapid economic recovery and preventing socioeconomic scarring. The Plan must Third, there are limits to government resources therefore include strategies that would ensure and capabilities; hence, government needs to macroeconomic stability and sound fiscal engage meaningfully with various sectors to management to keep consumer and investor deliver the needed interventions. The Plan, confidence in the economy high. Chapter 1 A Plan for Economic and Social Transformation | 5 therefore, must include strategies to enhance Fourth, though recovery has started, we need collaboration with local government units to fast-track investments in early warning and partnerships with the private sector and systems, efficient social protection programs, civil society. effective resilience-building strategies, research and development, technology–particularly digital technology–and innovation. …while addressing the scarring due to COVID-19. In 2020, COVID-19 was declared a global including support to employees, and to micro, pandemic and the country went into one of small, and medium enterprises (MSME). the world’s longest and strictest lockdowns beginning March of that year. For more than The lockdowns led to large financing needs to a year, most of the country was under some support families and businesses. Coupled with form of mobility restriction: people were low revenue collection due to business closures, not allowed outside their homes; offices and these resulted in a record-high PHP1.67 trillion businesses closed down; public transportation budget deficit and higher levels of borrowing was limited; and schools shifted to remote with debt-to-gross domestic product (GDP) learning. In the second quarter (Q2) of 2020, ratio climbing to 60.4 percent by the end of the economy saw its deepest contraction 2021 from only 39.6 in end-2019. Government at –16.9 percent. The unemployment rate expenditures increased due to direct cash jumped to 17.6 percent in April 2020, and transfers and COVID-19 response-related underemployment hit a high of 21 percent in costs such as: procurement of COVID-19 mid-2021. Positive growth was not seen until test kits and personal protective equipment Q2 2021, rebounding to 12.1 percent and (PPE); hiring of more health personnel; and nearly 7 to 8 percent in succeeding quarters, purchase and nationwide deployment of while the labor situation steadily improved COVID-19 vaccines. over time. Aside from the economic contraction, the In response to the immediate need for relief, pandemic also resulted in significant social Bayanihan 1 (Republic Act 11469) and sector losses, which may be harder to recoup. Bayanihan 2 (RA 11494) were enacted, and These include learning losses, low levels of the national government initially rolled out routine vaccinations,1 and the slowdown support to 80 percent of Filipino families of healthcare-seeking behaviors in the nationwide through cash transfers that were population, among others. For two academic good for two months. These were later dialed years, learners from preschool to tertiary down, both in terms of the amount and portions levels coped as best they could through of the population assisted, in the latter part of remote and blended learning modes instead the pandemic. In addition, various forms of of face-to-face classes. Worse, an estimated support were included in the Bayanihan Acts, five percent of primary school-aged children in the Philippines did not enroll in 2022 6 | Philippine Development Plan 2023-2028 while 91 percent may not be able to read or experienced learning losses. They were also understand short and age-appropriated text more likely to receive COVID-19 vaccines by age 10.2 The full impact of this erosion later, especially those in poor rural areas in human development will not be apparent and hard-to-reach communities, such as the until years later, and, if left unaddressed, will Bangsamoro Autonomous Region in Muslim lead to poor education and health outcomes Mindanao (BARMM). The latest poverty for a generation of children. Rebuilding and estimates show that the country’s gains in catching up will require strong prioritization of poverty reduction from 2015 to 2018 were education and health to prevent a more lasting partially reversed as the poverty incidence in negative impact on human development. 2021 increased to 18.1 percent, up from 16.7 percent in 2019, but remained lower than the Both the economic and social impacts of 23.5 percent poverty incidence in 2015, largely the pandemic disproportionately affected due to the government cash transfers targeted the poorest and most vulnerable: many lost to low-income households. their incomes, and children who did not have the means to learn with digital devices The Plan will build on “tried and tested” strategies… The significant reduction in poverty incidence President Rodrigo Roa Duterte favored regions observed between 2015 and 2018, from 23.5 outside the National Capital Region. to 16.7 percent, was a result of fast economic growth that was sustained over six years; Government spending on education and increased human capital investments; and health increased by an average of 14 and 13 the expansion of the Pantawid Pamilyang percent, respectively, over the period 2013– Pilipino Program (4Ps) beginning 2013, with 2019. The program for basic education was its enhancement beginning 2016. revised with new content and an additional two years. Tertiary education in state universities Gross domestic product grew by an average and colleges was later provided for free. of 6.6 percentage points over the period Scholarship programs were also expanded, 2012–2019. This was the by-product of an including in technical and vocational agenda of good governance, level playing education and training (TVET) institutions. field, and ease of doing business. The agenda Health care provision was enhanced with was later institutionalized either through the implementation of the Health Facilities legislation or executive order. Enhancement Program. Health care financing was later expanded through the establishment Government spending on infrastructure of Malasakit Centers. increased, averaging 2.6 percent of GDP from 2013 to 2016, to 4.6 percent of GDP from 2017 Coverage of the 4Ps increased from 630,000 to 2019. Many of the infrastructure projects, households in 2009, to 3 million in 2012, then including those under the Build, Build, Build 4.4 million households in 2016. The amount program of the administration of former of cash transfers also increased in 2016, mainly Chapter 1 A Plan for Economic and Social Transformation | 7 to maintain the real value of the transfers as broadened the tax base. TRAIN resulted in provided in 2012. additional net revenues because of the increase in excise taxes on petroleum products, the new Fiscal health was improved through aggressive excise tax on sweetened beverages, and the tax reforms, which were intended to make the repeal of over 50 provisions on value-added tax system simpler and fairer. The Tax Reform tax exemptions and zero-rating. for Acceleration and Inclusion (TRAIN) reduced personal income tax rates but also …and will take on “unfinished business”… Several long overdue reforms have also been COVID-19-induced losses, we have yet to see passed. The Rice Tariffication Law (RTL), which the full impact of the more open investment was stalled for about 30 years, was enacted in climate promoted by these liberalization laws. February 2019 to alleviate the 2018 rice supply crisis and modernize the agricultural sector. Many social sector reforms, while critically While rice yield has increased from 3.9 to 4.1 important, are not yet fully implemented. The metric tons per hectare pre- and post-RTL government has already taken initial steps implementation, respectively, the rice industry toward digitalization and financial inclusion road map is yet to be finalized. through the Philippine Identification System or PhilSys Act (RA 11055). However, PhilSys Amendments to the Foreign Investment Act processes need to be expedited. As of November (FIA), Retail Trade Liberalization Act (RTLA), 4, 2022, registration to PhilSys has reached and the Public Service Act (PSA) were also 74.7 million individuals, which is 81.2 percent enacted into law, intended to further ease of the target 92 million individuals. Nearly 48 restrictions on foreign investments, especially million PhilSys numbers have been generated, in strategic industries. Also enacted during the 23.7 million ID cards printed, and 18.7 million pandemic was the Corporate Recovery and ID cards delivered.3 Another crucial reform, Tax Incentives for Enterprises Act (CREATE), the Universal Health Care Act (RA 11223), which lowers the corporate income tax rate which registers all Filipino citizens to a and provides incentives to strategic industries national health insurance program, is still in irrespective of ownership. However, because the process of developing a progressive health the effectivity of these laws coincided with care system within the next six years. the global economic slowdown due to …while taking full cognizance of emerging global and regional trends. The unprecedented health crisis changed emerging patterns that may pose risks as well the status quo of health care, economic as opportunities to the country’s development management, and technology, among others, in the upcoming years. across the globe. This section evaluates 8 | Philippine Development Plan 2023-2028 Health and Social Trends Continued impact of COVID-19 The pandemic has been a traumatic experience crossed borders. In fact, the characterization to many, particularly as it evolved from a of the “new normal” is still unclear; it purely health crisis to a multidimensional one, varies widely from going back to the “old revealing an interconnected set of problems. normal,” to imposing minimum or strict While mortality and hospitalization figures public health standards particularly in the began to decline globally due largely to 3Cs (crowded events, closed spaces, and vaccination, new strains have emerged and close-contact activities). China’s dynamic Zero-COVID Policy Some countries continue to uphold stringent international travel for Chinese tourists. The mobility restrictions that may generate both latter proved critical as tourism in Southeast local and international implications, such Asia and East Asia is highly dependent on the as in tourism. For instance, China has been Chinese market of tourists. Outbound tourists implementing its “dynamic zero” COVID from China were the world’s biggest spenders policy that includes imposing unpredictable in 2019, comprising 20 percent of global lockdowns to curb COVID risks, which tourism spending.4 in turn dampened both domestic and Aging global population Notwithstanding the pandemic, the global 1.4 billion in 2030.6 This is expected to further trend is geared toward longer life expectancies rise and reach a total of 2.1 billion aged 60 and generally healthier populations, combined and over in 2050. Much of this global ageing with lower fertility (50% decline in the past has been driven by many industrial countries, 70 years alone),5 which are among the factors but increasingly in the next three decades, that contribute to global ageing. The World many developing countries, including the Health Organization (WHO) forecasts that in Philippines,7 will follow this trend. Up to two- 2030, one in six people worldwide will be 60 thirds of the world’s population aged 60 years years old or over—an increase in total from and over will be accounted for by low- and one billion aged 60 and over in 2020 to about middle-income countries in 2050. Increasing demand for health care workers Recognizing the critical importance of health temporary ban on the deployment of health care workers (HCW) in the fight against workers in April 2020.8 This has since been COVID-19, the government imposed a relaxed from implementing a total deployment Chapter 1 A Plan for Economic and Social Transformation | 9 ban to instituting a cap on deployment of PHP35,000 in government hospitals; while it 7,500 HCW per year.9 Demand for HCW has could rise to as much as PHP275,000 in the been amplified by the pandemic, especially in United States. The wage offer in advanced advanced economies with aging populations. economies is expected to increase with the This translates into a huge wage differential. growing demand for health care, making it For instance, the base salary for nurses in more attractive for Filipino health workers to the Philippines ranges from an average of go abroad. This may adversely affect access to, PHP17,000 in private hospitals to around and quality of health care in the country. Economic Trends Headwinds in global economic recovery After more than two years of the pandemic, the Many industrial and developing countries world economy is still struggling to get back on accumulated debt to finance countercyclical track. The International Monetary Fund (IMF) fiscal and social protection responses to forecast global growth in 2022 at 3.2 percent, a COVID-19. Total global debt rose by 30 significant decline from the 6 percent rebound percentage points of world GDP in 2020 alone; posted in 2021. Global growth is expected to the largest single-year increase in world debt fall further to 2.7 percent in 2023, with a 25 since the 1970s. In the same year, the total debt percent probability that it could fall under 2 breached 200 percent of GDP in emerging percent. The three largest economies in the markets, while total debt topped 300 percent world—the United States (US), European of GDP in industrial countries.12 The surge in Union, and China—are all expected to sovereign debt spreads and monetary policy struggle with their immediate post-pandemic tightening among in countries to temper economic growth recovery. In addition, inflationary expectations have since created almost half of more than 70 economies pressure on borrowing costs for many emerging monitored by the IMF are expected to face a market economies and developing countries. technical recession, measured as at least two The strength of the US dollar, driven in part consecutive quarters of economic contraction, by the Federal Reserve’s monetary tightening in the upcoming year.10 This uneven recovery, as well as the “flight to safety” during volatile shaped by the various factors discussed in this times, is likely to create additional pressure chapter, affects major commodity supplies. on both domestic inflation (due to exchange International supply chains, still recovering rate pass-through) and on borrowing costs for from the pandemic, are also less predictable many countries. given the uncertainty of the international economic environment.11 10 | Philippine Development Plan 2023-2028 Geopolitical Trends Ongoing international tensions By early 2022, geopolitical, environmental, conflict between China and Taiwan; and and food security risks began to conflate the lingering disputes in the South China Sea. pandemic-related challenges, further hindering An escalation of the conflicts in the South inclusive recovery. The intensification of the China Sea would be devastating to the global Russia–Ukraine conflict on February 24, 2022 economy as the area accounts for 12 percent created ripple effects that affected an already of the world’s fish catch, and more than 30 weakened global economy. Both Russia and percent of all global maritime trade passes Ukraine are important international suppliers through it. About 40 percent of the world’s of food and other key commodities, such as liquefied natural gas shipments also traverse wheat and sunflower oil. Russia is also the third the South China Sea, which also contains largest oil producer in the world and accounts deposits of about 11 billion barrels of oil and for ten percent of total global oil production. 190 trillion cubic feet of natural gas.14 Any The resulting oil price increases have created potential maritime conflict poses a huge threat, knock-on effects on transportation costs and as the world’s coastal regions contribute about goods trade.13 USD1.5 trillion to the global economy each year—a number expected to double by 2030 to There are also other potential dangers from USD3 trillion based on estimates by the World geopolitical tensions in Asia. These include: Trade Organization (WTO).15 recent tensions in the Korean peninsula; Shifts in Asian investments and manufacturing Many foreign investors are recalibrating their consequently, reshaping the investment and investment portfolios in China, often with a trade landscape underpinning vibrant GVCs view to relocate to Southeast Asia.16 These shifts in the Asian region. are not new as the relocation of some foreign investments from both Japan and China even In October 2022, the US imposed sweeping preceded the COVID-19 pandemic.17 Pre- restrictions on technology exports to China, existing factors shaping global value chains such as computing chips, supercomputers, and (GVCs) in Asia include the intensifying trade advanced semiconductors.19 Several Southeast conflicts among major trading partners since Asian countries have started to ramp up 2018; increased automation that triggered incentives for new companies in anticipation the return of some production to industrial of foreign manufacturing firms leaving countries; and increased costs of production China. For instance, the Philippines provided in China.18 Most recently, geopolitical tensions investment incentives that attracted at least between China and some western economies, nine multinational enterprises to relocate and China’s stringent anti-COVID-19 their respective manufacturing facilities from policies are likely accelerating this shift and, China since 2019.20 Chapter 1 A Plan for Economic and Social Transformation | 11 Environmental Trends There has been a dramatic shift in the world’s rise to 1.5 degrees.23 In an unprecedented weather patterns and temperature records are move, during the COP27 held in November now routinely being set every three years since 2022 in Egypt, several European countries 1981.21 According to the World Meteorological agreed to establish a loss and damage fund, Organization, economic losses from weather- which extends financial assistance for rescue related disasters increased sevenfold from and reconstruction in developing countries as the 1970s to the 2010s. All these trends are a result of extreme natural disasters brought by interconnected with more frequent and more climate change.24 intense weather events such as hurricanes, wildfires, and heat waves taking place around In the present post-pandemic and economic the world. environment, governments will be hard-pressed to deliver on climate change International collective action to respond to commitments on their own. There needs to be climate change will be tested by the challenging greater synergy in central and local government global economic recovery conditions in the policy and regulatory frameworks, supported medium term. In the 2021 Glasgow Climate by research and development (R&D), to fulfill Pact during the 26th United Nations Climate these commitments. A scenario where trade Change Conference, more commonly referred and investment flows will favor those between to as COP26,22 almost 200 countries committed and among economies strongly committed to to make the 2020s a decade of climate action accelerated climate action is highly likely. This and support. Industrial countries have pledged will then induce the private sector to put in USD100 billion annually for developing more resources and even to lead parts of the countries, with the goal of reducing emissions overall response. and capping the global average temperature Technology and Regulations Rapid digitalization across the globe Many development opportunities have also of digitalization in government and in the emerged in recent years, even during the private sector. In the public sector, this enabled pandemic aftermath. For instance, in part due service continuity; while in the business sector, to the successful adaptation strategies during business continuity meant having to switch the pandemic, various countries were able to from relying on foot traffic to online traffic.25 tap their domestic industries for innovation and repurposing to help in the whole-of-nation Technology and intellectual property are effort to respond to the pandemic. COVID-19 among the key areas increasingly featured in has also served as a catalyst for fueling a wave international trade and investment discussions. 12 | Philippine Development Plan 2023-2028 Due to the nature of technology-driven a way to: grow the global economy; connect industries and sectors, these discussions are people to economic opportunities; reduce inevitably intertwined with issues on network export and transaction costs significantly; externalities, competition policy, intellectual and aid in building international consensus property, and even national security.26 through regional negotiations.27 The RCEP also includes commitments to bolster e-commerce For example, the Regional Comprehensive by protecting online consumers and their Economic Partnership Agreement (RCEP) personal information and strengthening —which has been signed by almost all regulatory frameworks, notably in areas of ASEAN countries plus Australia, China, transparency and cybersecurity.28 Countries, Japan, Republic of Korea, and New Zealand— including the Philippines, will need to navigate supports information and communications these international trade and investment technology (ICT)-enabled trade facilitation agreements to maintain robust connections measures, promotes free cross-border flow to evolving global value chains, which will be of data, and accommodates less stringent largely shaped by advances in technology and approaches to data localization. Leveraging emerging standards and regulations. cross-border data transfers has been lauded as Global megatrends for 2030 Even prior to the pandemic, various groups encouraged. Disruptive technologies from pointed to global megatrends that could shape these investments offer opportunities for the decade in fundamental ways. In its Global transformation in various sectors. Connectivity Outlook report, the World Bank noted several main messages for policymakers Electric vehicles can shift demand from fuel and planners.29 Disruptive technologies do not to batteries, while autonomous vehicles have just promise improvements in connectivity, the potential to improve road competitiveness but also innovation in how connectivity and transport logistics. With renewable is formed and used. Long-term planning energy becoming increasingly attractive and of infrastructure and resource allocations attainable, energy-related shipping for coal must not assume a continuation of past and oil are also estimated to decrease by 50 trends but constantly adapt to the evolving and 25 percentage points, respectively. As digital and technological landscape of the a result, there may be limited demand for Fourth Industrial Revolution or Industry 4.0. new investments for coal or oil transport Changing consumption patterns, as a result infrastructure in the next few years. Finally, of the rising urban middle class population in the effects of additive manufacturing remain Asia, can result in the flow of infrastructure uncertain. Freight volume may depend on investments to the region. Meanwhile, the difference in price sensitivity for these investments in digital capacity through the types of products. Lower- and middle-income Internet of Things (IoT), artificial intelligence, groups that may be more conscious of prices mobile internet, and Big Data analytics are can lead to growing flows in freight; whereas a Chapter 1 A Plan for Economic and Social Transformation | 13 decline can be expected among upper-income Revolution is expected to be underpinned by countries willing to spend on these products. connectivity, digitalization, automation, IoT, and big data, among others. Technological More broadly, the available analyses of global surveillance, R&D, and learning-by-doing megatrends point to the role of technology and will be critically important activities to inform its disruptive effects, and the opportunities policymaking and business strategy.30 for enhancing economic development and well-being of millions. The Fourth Industrial Overview of the Philippine Development Plan 2023-2028 The Philippine Development Plan (PDP) The PDP 2023–2028 is based on President 2023–2028 is a plan for deep economic and Ferdinand R. Marcos Jr.’s 8-point social transformation to reinvigorate job socioeconomic agenda that tackle immediate, creation and accelerate poverty reduction by on-the-ground concerns—high inflation, steering the economy back on a high-growth scarring due to COVID-19 and the tight path. This growth must be inclusive, fiscal space; address long-standing, critical building an environment that provides equal constraints to generating more jobs, quality opportunities to all Filipinos, and equipping jobs, and green jobs over the medium; and them with skills to participate fully in an provide the necessary enabling environment— innovative and globally competitive economy. level playing field, and peace and security. The underlying theme of PDP 2023–2028 is transformation… Taking off from the lessons learned especially transparency, and fewer opportunities for during the pandemic, the PDP 2023–2028 takes corruption at various levels. Digitalization can on the underlying theme of transforming the also help the government build better data economic and social sectors and institutions systems that will create better programs, such for a prosperous, inclusive, and resilient as more targeted social protection enabled by society. The transformation agenda is broken the national ID through PhilSys; and better down into: link job seekers to employment opportunities through the expansion of the automated job Digitalization. Digital transformation of and applicant matching system, PhilJobNet, government will result in more efficient and created by the Department of Labor and faster service delivery to the people, more Employment (DOLE). Compliance with 14 | Philippine Development Plan 2023-2028 regulations may also increase with digital creatives, tourism, and logistics to move up the filing and digital payment systems. global value chain. The COVID-19 pandemic has forced a wave Dynamic Innovation Ecosystem. Innovation of digital adoption across the country. An will translate knowledge and ideas into new important development is that as more products, and/or new and better processes. institutions and businesses digitalized, This requires an ecosystem involving the proportion of consumers that entered knowledge and R&D institutions, product and the digital marketplace has also expanded process design, marketing, and entrepreneurs. rapidly. The rapid and massive migration Government will support the creation of of people into the digital space is an innovation ecosystems and their evolution to opportunity to push toward fully digitalizing becoming a dynamic ecosystem that eventually sectors that have not been able to pivot generates not only more, but quality jobs. their processes to maximize the potential efficiency brought about by digitalization. Enhanced Connectivity. As an archipelago, the Philippines has unique challenges with Servicification. Servicification fosters inter- connectivity. Digital connectivity is only sectoral linkages to create synergies for more one form, as physical connectivity through value-adding opportunities, expansion of infrastructure and transport is similarly products and markets, and more efficient important to link markets to each other; delivery network. The Philippines has had connect urban centers to rural areas; and a strong competitive advantage in services, facilitate the movement of people whether which has accounted for a large proportion of for employment, business and marketing GDP and employment both domestically and transactions, or even socialization and internationally, albeit in lower productivity recreation. Communities should be linked to jobs. Where the country has been unable these opportunities through the development to compete successfully is in expanding of local road networks that reduce the costs of manufacturing, which, for many other transport, while also adopting active mobility countries, has been the driver of job generation. options and e-vehicles. The evolution of these sectors has blurred the In addition to investing in connectivity line between manufacturing and service jobs, domestically, there are also opportunities to as manufacturing now requires more service- ramp up the connectivity of the country to related labor, which has become more mobile the rest of the world. Increasing the capacity and transmittable via digital means.31 of airports can revitalize tourism; upgrading Servicification as a strategy means pursuing ports and improving maritime safety can policies that will build ecosystems around facilitate the movement of goods, thereby economic clusters identified as potential promoting trade and making the country sources of high growth, to attract more more attractive to investments. investments and expand its demand for higher Greater collaboration between local and productivity jobs. Priority servicification can national government. The PDP seeks to also be targeted toward the industries of ICT, Chapter 1 A Plan for Economic and Social Transformation | 15 bring local governments in as equal partners resilience, and local infrastructure. Thus, the in the development agenda of the country. As completion of Devolution Transition Plans frontline service providers, LGU performance (DTP) will be fast-tracked and operationalized can spell the difference between regional to improve each LGU’s capacity for delivering development and regional stagnation. public services and raising local revenues. One of the major developments in the Partnership with the private sector. There are governance landscape of the Philippines is multiple areas to expand the role of the private the Mandanas-Garcia ruling of the Supreme sector to deliver more benefits to the public. Court in 2018. The ruling meant that the The government’s role is to provide calibrated internal revenue allotments (IRA) of local incentives to priority industries and foster an governments would increase by about 23 enabling business environment to allow job- percent in keeping with the spirit of the Local generating businesses and industries to grow. Government Code of 1991.32 This led to a Reconfiguring public–private partnerships “re-devolution” of programs and functions (PPP) can also help in addressing cross-cutting to local government units (LGU) as national issues of a weak competition environment and agencies faced smaller budget allocation. the digital divide, as well as boost the country’s campaign to attract foreign investments. The Operationalizing the Mandanas-Garcia ruling tight fiscal space that will constrain public is an opportunity to optimize the sharing investments for the next few years provides of responsibility between local and national a rationale for favoring PPPs in enhancing government. Over the medium term, there and upgrading infrastructure. Larger private will be close coordination through capacity- sector participation in areas such as housing, building programs and mentoring for LGUs, transport, digital, and other related large especially in areas where national government infrastructure can free up public funds for support will be needed. These include investments in human capital to address, for important human development investments, instance, the scarring from the pandemic in notably in health, social welfare, disaster health care and education. …that is integral in all the strategies of the PDP. The overarching goal of the PDP 2023– produce competitive products; and (c) foster 2028 is to achieve economic and social an enabling environment encompassing transformation for a prosperous, inclusive, and institutions, physical and natural environment, resilient society. The strategies are organized which promotes a prosperous, inclusive and corresponding to the following objectives: (a) resilient society. develop and protect capabilities of individuals and families; (b) transform production sectors to generate more quality jobs and 16 | Philippine Development Plan 2023-2028 Figure 1.1 Strategy Framework of Philippine Development Plan 2023–2028 MATATAG, MAGINHAWA AT PANATAG NA BUHAY ECONOMIC AND SOCIAL TRANSFORMATION FOR A PROSPEROUS, INCLUSIVE, AND RESILIENT SOCIETY DEVELOP AND PROTECT CAPABILITIES TRANSFORM PRODUCTION SECTORS TO GENERATE OF INDIVIDUALS AND FAMILIES MORE QUALITY JOBS AND COMPETITIVE PRODUCTS REDUCE PROMOTE HUMAN INCREASE MODERNIZE VULNERABILITIES AND REVITALIZE REINVIGORATE AND SOCIAL INCOME-EARNING AGRICULTURE AND PROTECT PURCHASING INDUSTRY SERVICES DEVELOPMENT POWER ABILITY AGRI-BUSINESS BOOST HEALTH ENSURE FOOD INCREASE PROMOTE TRADE AND INVESTMENTS SECURITY AND EMPLOYABILITY IMPROVE EDUCATION PROPER NUTRITION AND LIFELONG EXPAND ADVANCE R&D, TECHNOLOGY, AND INNOVATION LEARNING STRENGTHEN SOCIAL EMPLOYMENT PROTECTION OPPORTUNITIES ENHANCE INTER-INDUSTRY LINKAGES ESTABLISH LIVABLE ACHIEVE SHARED COMMUNITIES LABOR MARKET PROMOTE COMPETITION AND IMPROVE GOVERNANCE REGULATORY EFFICIENCY PRACTICE GOOD GOVERNANCE ENSURE MACROECONOMIC STABILITY AND AND IMPROVE BUREAUCRATIC EFFICIENCY EXPAND INCLUSIVE AND INNOVATIVE FINANCE ENSURE PEACE AND SECURITY, AND EXPAND AND UPGRADE ACCELERATE CLIMATE ACTION AND ENHANCE ADMINISTRATION OF JUSTICE INFRASTRUCTURE STRENGTHEN DISASTER RESILIENCE Capabilities of individuals and families will across all levels. TVET programs will be be developed to enable them to participate improved to make them more responsive to in growth opportunities (Chapter 2). industry needs. Higher-education institutions will be strengthened to perform a greater Good health will be promoted role in knowledge co-creation, and serve as (Subchapter 2.1). Health care strategies will innovation hubs and incubation centers. be comprehensive and will focus on building an ecosystem in communities for health Social development will be pursued care providers, and an environment where through livable communities (Subchapter individuals can make healthy choices (e.g., 2.3). For communities still to be established, nutritious affordable food and health literacy). access to human, social, and economic development opportunities will be facilitated Opportunities for transformative lifelong by design. Simultaneously, there will be learning will be expanded (Subchapter 2.2). programs to upgrade the conditions in The quality of education at all levels will be existing communities where these are found improved by expanding access to quality to be inadequate. learning resources, enhancing the curriculum, and improving the competencies of teachers. Social protection (SP) systems will be made The evaluation protocol for learning outcomes more efficient with improved targeting and will also be improved by involving third-party digitalized processes for faster response to institutions to assess students’ proficiency the needs of the most vulnerable (Chapter 3). Chapter 1 A Plan for Economic and Social Transformation | 17  Amidst the possibility of accelerated support, and an active labor market inflation owing to natural and external information system. shocks, the priority is to ensure food security and proper nutrition, especially among the Everyone will have access to opportunities to most vulnerable (Subchapter 3.1). A sufficient increase their income-earning abilities by the and stable supply of food will be ensured, effective enforcement of anti-discrimination primarily through improved productivity laws. Migrant workers will also have access of agri-food systems, including storage, to these opportunities to facilitate their transport, and logistics. Measures to prevent reintegration back into the domestic economy. and address wasting, stunting, and obesity The production sectors will be transformed will be implemented through supplementary to provide high-quality, high-skill, and feeding, nutrition education, and nutrition stable employment opportunities for the promotion campaigns. fast-growing Filipino workforce. Social protection systems will be The strategies in each sector are categorized strengthened (Subchapter 3.2). There will be into three major groups: (a) expand markets, programs to reduce the risks faced by specific (b) promote value-adding, and (c) foster vulnerable groups (persons with disability, inter-sectoral linkages. women, children, indigenous persons, persons in geographically isolated and disadvantaged Agriculture and agribusiness will be areas [GIDA], migrant workers, etc.), and to modernized (Chapter 5). Primarily, mitigate the impact in case the risk materializes. production efficiency will be improved A universal, modern, and integrated SP system through farm clustering or consolidation, will be established to improve targeting, adoption of improved technology, and access rationalize interventions, and facilitate the to inputs. More innovation hubs and farm timely delivery of SP services. demonstration sites will be established and the Province-led Agriculture and Fisheries Jobseekers and those currently working will Extension System will be strengthened. The have more opportunities to improve their blue economy will be developed with the full income-earning ability (Chapter 4). implementation of the Fisheries Management Contents of training modules and curricula Act plans, and the upgrading of Technology for human capital development will be Outreach Stations, and National Technology continuously updated to match the needs Centers, among others. Opportunities for of emerging in-demand occupations. The greater value-adding will be created by updating will also cover professional standards expanding business partnerships between and licensure examinations. primary producers and other entrepreneurs, and by strengthening the capacity of primary Employment facilitation services will be producers to process raw materials, understand enhanced to include career development markets, and ensure that food safety and quality standards are met. Government will rationalize 18 | Philippine Development Plan 2023-2028 investments in the sector to promote the Streamlining regulations to allow 24/7 interconnectedness of multimodal transport operations of transport and logistics operations and logistics, particularly for perishable will also increase demand. Value-adding to products. Use of mobile platforms and diversify “product” offering and improve channels will be encouraged for marketing, “consumption” experience will be encouraged payment, and product delivery. Institutional by instituting accreditation protocols; capacity to formulate plans, conduct R&D, improving access to physical and digital provide extension services, and undertake infrastructure; and developing technology monitoring and regulation will be enhanced parks, centers of creative excellence and with the use of modern technology and better innovation, creative talent hubs, and improved information systems. shared service facilities for MSMEs. Finally, capacities of institutions providing business Industry will be revitalized (Chapter 6). advisory services, and of communities and Domestic production and supplier base will LGUs hosting the investments and events will be expanded, particularly corresponding to be continuously upgraded. the value chains of the following industry clusters: (a) industrial, manufacturing, and Establishing a dynamic innovation ecosystem transport (IMT); (b) technology, media, and is at the heart of the transformation agenda telecommunication (TMT); (c) health and life of the PDP 2023-2028 (Chapter 8). The sciences (HLS); and (d) modern basic needs innovation ecosystem involves interlinkages (MBN). This entails enhancing business- between and among social scientists, basic matching activities and intensifying support R&D institutions, product engineers, design through the provision of common service and marketing specialists, and entrepreneurs facilities, marketing assistance and even who bring the ideas and all these players time-bound performance-based incentives. together. Over the medium term, government Servicification will be promoted, including will (a) provide a nurturing environment the adoption of Industry 4.0, IoT, etc. This for basic research and development, will be done through co-locating industry and knowledge creation; (b) support and service ent