The Philippines must sustain public investment in infrastructure to catch up with other Asian countries, the International Monetary Fund said in a report Wednesday.
It said in the past 25 years, general government investment in the country trailed most other Asian economies. Budgetary allocation to public investment in the Philippines declined from about 4 percent of the gross domestic product in the 1990s to about 3 percent of GDP from 2000 to 2015, although it increased in the last few years.
It said Philippine public capital stock “remained low by emerging market standards, and its general government capital stock has eroded steadily from the early 1990s.”
IMF said the gap between the Philippines’ capital stock and the average of Asean countries was more than 30 percent. The average emerging market economies’ capital stock was almost 60 percentage points higher than that in the Philippines.
It said that while public investment in the Philippines generally improved infrastructure, it had not fully delivered the expected economic benefits, suggesting that the efficiency of public investment could be improved.