Philippines Infrastructure Expansion & Upgrade Plan PDF

# Chapter 12: Expand and Upgrade Infrastructure Enabling economic transformation builds on sustainable, resilient, integrated, and modern infrastructure systems as a solid foundation. Anchored on the long-term vision, the government will steer the nation toward a future where movement of people a...

# Chapter 12: Expand and Upgrade Infrastructure Enabling economic transformation builds on sustainable, resilient, integrated, and modern infrastructure systems as a solid foundation. Anchored on the long-term vision, the government will steer the nation toward a future where movement of people and goods is safely and efficiently facilitated by adequate and accessible transportation. Filipinos are empowered through cost-effective and reliable flow and exchange of information and are able to partake opportunities in the digital economy. Families have access to safe and adequate water and sanitation services; to reliable, clean, and affordable fuel and electricity; and to quality education, health, solid waste management, and other social infrastructure facilities. Communities and industries are served by green infrastructures that are not only adaptive and resilient against shocks and natural disturbances but also contribute toward a low-carbon future. ## Assessment Annual public infrastructure spending in 2017-2021 during the administration of former President Rodrigo Roa Duterte ranged from 4.2 percent to 5.8 percent of gross domestic product (GDP), which is nearly double the average annual spending over the previous decades. Overall, however, infrastructure facilities and services remain inadequate in terms of accessibility, quality, safety, and affordability. Moreover, the country's continuing vulnerability to climate change already threatens infrastructure provision and operation and thereby undermine significant infrastructure investments. ## Connectivity - **Mobility of majority of Filipinos is hampered by inadequate transportation facilities.** There is a shortage in public transport supply. This is evidenced by long queues of commuters and passengers who spend long hours waiting for their rides, and, when they get one, stand inside buses or trains overcrowded with other commuters. The Philippine rail system's capacity is inadequate to meet the ridership post-pandemic. The country has four operational rail lines with a total length of 76.9 km. - **Meanwhile, the number of train cars increased to 978 in 2022 from 224 in 2016.** New mass transit railways were also approved in the last six years, with the two largest now under construction. While a drop of 68 percent in total rail ridership was recorded from 2019 (327.68 million) to 2021 (103.79 million), ridership increased by at least 23.45 percent from January (9.14 million) to May 2022 (11.94 million). Should this trend continue and as the economy opens up after the coronavirus disease (COVID-19) pandemic, the existing rail network will not beable to accommodate the increasing demand, which rose to as high as 29.4 million monthly ridership in 2019 to the 2022 total capacity of about 31.8 million per month. - **Transport facilities deemed inaccessible and unsafe, especially for vulnerable groups.** According to the National Council on Disability Affairsin in 1982, the physical design of the rail infrastructure falls below the standards set in the 1982 Accessibility Law, and thus makes them difficult to access and use by pregnant women, parents with very young children, older people, and persons with disabilities (PWD). Stations with non-functional elevators and escalators, defective restrooms, missing signages, poor security measures such as lack of security cameras, overcrowding, and insufficient lighting in passenger set down further aggravate the risks of accidents, crime, and violence faced by commuters, especially females. Gender-based violence, sexual exploitation, abuse, and harassment and discrimination are common and possibly under-reported in public spaces including the transport sector. - **Shortage of road-based public transportation persists in many urban areas.** Since 2003, public transport services franchising has been under a moratorium. This has not helped reduce the shortage of public transport in many cities. Besides being obsolete, most of the public transport fleet in 2022 also do not comply with modern design and emission standards. Meanwhile, the rollout of the Public Utility Vehicle Modernization Program launched in 2017 has progressed slowly since many vehicle owners found the financial terms of the program unattractive and the funding support from the government in the form of subsidy for vehicle procurement was limited. - **As of September 14, 2022, a total of 174,164,758 riders have benefitted from the Land Transportation Franchising and Regulatory Board Service Contracting Program (SCP) Phase III, versus the target of 93,000,000.** While the SCP has provided a means for public transport operators and drivers to sustain their operations as more economic sectors open post-pandemic, the program does not cover the whole country and cannot be sustained given the tight fiscal space. - **Use of active transportation is still not popular.** The Department of Health (DOH) has issued guidelines promoting the safe use of active transport, while the Department of Public Works and Highways (DPWH) has issued an order prescribing the standards on the design of bicycle facilities along national roads. To fund the building and maintenance of bike lanes and other active transport facilities, the government allocated total of PHP3 billion from 2020 to 2022. While there are four households that own bicycles to each household that own a car (4:1 bicycle-car ratio), only 29 percent of households use their bicycles to go around. - **Road traffic fatalities are increasing in the Philippines.** Road traffic accidents exact a heavy toll. Approximately 12,000 Filipinos die on the road each year, while the resulting injuries cost about 2.6 percent of the country's GDP in 2018. The government does not have a yearly budget allocation for road safety. - **While progress has been made in maritime transportation, issues on infrastructure quality remain.** Improvements were pursued with the opening of the Matnog, Sorsogon to Bogo City, Cebu roll-on/roll-off (RORO) route, and the issuance of the revised rules in the grant of missionary route status for RORO passenger ships, and the development of the Maritime Route Rationalization and Information System. Nonetheless, only a limited number of RORO vessels can be accommodated under the size of the country's RORO ports in 2022. RORO vessels that serve medium-sized ports are smaller compared to RORO ships that use the Port of Manila. The fleet of inter-island ferries is also aging, posing safety risks to commuters. - **Civil works and utilities installation along roads are not coordinated.** Road widening activities are not in sync with the relocation of electrical and communication poles, as well as pipe laying and other waterworks, causing traffic jams, road accidents, and other roadside friction. Prevalence of overhead electrical and telecommunications cables and poles along major thoroughfares poses hazards to road users. Meanwhile, the lack of coordination between road works and waterworks results in prolonged or repeated closure of roads and higher construction costs. - **There are no operational cargo and/or freight rail services in the country.** The movement of goods over land is limited to road-based transportation options; rail-based transportation options are non-existent. As such, long-, medium, and short-distance shipping by land is done by trucks, which adds to road traffic congestion and to logistics cost. The roads leading to ports and airports often experience congestion and deteriorate faster due to heavy truck loads. - **Little progress has been made to improve airport infrastructure.** The country has a total of 90 airports in operation -comprising 11 international, 41 domestic, 38 community-and 3 airports not in operation in 2022. However, not all the country's international airports and principal Class 1 and principal Class 2 airports comply with modern safety design thresholds, particularly the minimum runway strip threshold width and night landing capabilities. Proposed improvements to major gateways in the country were put on hold and are being re-assessed to consider new projections in aviation demand. Travel limitations, lockdowns, and hampered business operations due to the COVID-19 pandemic caused the decline in passenger traffic by 33.47 percent from 2020 to 2021. Over the same period, air traffic movement likewise decreased by 54.7 percent. - **Port and ancillary facilities are insufficient and underdeveloped.** As of December 2021, about 336.56 million metric tons (MMT) of cargo was transported through the country's port system compared to 133.74 MMT through airports. Meanwhile, 99.98 percent of the total domestic trade in 2021 was transported by sea, and the rest (0.02%) via air." - **Despite the maritime sector's critical role in the transport of goods, most of the country's ports are operated inefficiently due to their inadequate equipment and ancillary facilities.** Such inefficiency is evident in the long queues of cargo trucks at port areas. Cargo trucks sometimes wait for days before they are able to board a RORO vessel. Such delays result in poor reliability in the delivery cargoes and spoilage of perishable goods, further straining the food supply chain, among others. - **Government-operated ports, especially those of local government units (LGUs), have insufficient cargo-handling equipment.** Existing LGU-operated ports have limited financial resources to procure the necessary equipment and support infrastructure such as cold chain facilities, leading to increased logistics costs. - **Automated logistics processes are not yet integrated.** To upgrade the country's logistics network, Unified Logistics Pass (ULP) was launched in 2022 that features a quick response (QR) code issued to cargo trucks. This ensures unhampered movement of goods and eliminates the various permits, licenses, and pass-through stickers being required by economic zones, ports, and LGUs. In addition, a single Transport Accreditation Permit and Pass for Ports (TAPPP) is being implemented in all ports under the jurisdiction of the Philippine Ports Authority (PPA). While these initiatives have already been introduced and implemented, their application is not yet integrated well in port operations across the country. Thus, trucks operating in both PPA and non-PPA ports, such as those in the economic zones, need to have the two systems installed. This translates into additional overhead cost that could have been avoided in an integrated system. - **Movement of information through digital infrastructure steadily improved, but still not enough.** Driven by increasing demand of Filipinos to stay informed and connected, recent years saw steady improvement in the quality of internet services with broadband speed, reaching 78.69 megabits per second (Mbps) in September 202213 (from 4.3 Mbps in 2016). In this aspect, however, the Philippines consistently lags behind Singapore, Thailand, Malaysia, and Vietnam. Moreover, the domestic prices of fixed and mobile broadband prices¹¹ remained high, at 11.56 percent and 2.04 percent of monthly gross national income per capita, respectively. Both rates are above the global affordability threshold target (of below 2%). As evidence of the persistent digital divide, only about 18 percent of Filipino households have internet connections, far below the average household penetration rate of 53.4 percent in the Asia-Pacific region in 2019.15 - **Climate change is not systematically integrated in planning, design, operation, and maintenance.** Climate change does not only adversely affect connectivity, but also places a strain on the country's economy. The resulting economic losses could be massive and would require significant additional financing to rehabilitate the damaged infrastructures. Due to Typhoon Odette in 2021, 36 percent of seaports were rendered inoperational, creating logistics challenges and disruptions in supply chains, especially for isolated islands. In addition, some municipalities had limited access to communication services for six weeks, which further hampered disaster relief and recovery operations.