Finance Secretary Benjamin Diokno yesterday said the Maharlika Investment Fund (MIF) will be a good addition to government’s sources of funding for infrastructure amid its push for a P8.3- trillion spending on the sector.
At the post- State of the Nation Address (SONA) forum yesterday, Diokno said the MIF will lessen the strain on public finances in funding the projects – all 194 projects currently identified – that the government plans to bankroll.
“Out of the 194 projects without the Maharlika fund, 55 percent of those projects will be funded through official development assistance (ODA), another 10 percent will be funded through the budget, another 30 percent, will be funded through public private partnership (PPP). With the Maharlika fund, then we have another source and a different source of funding,” Diokno said.
“It’s a funding that will not put a strain in our budget and not put additional borrowing or burden on our people. Every investment fund or wealth fund evolves over time, but to us the priority use of that Maharlika fund is to fund those priority projects,” he added.
Diokno said the lined-up projects will perk up the country’s infrastructure sector in the next 20 years, as the government capitalizes on the momentum provided by the previous administration’s own infrastructure spending push.
“For the last 50 years before the Duterte administration, we were only spending about 2 percent. That’s why we were suffering in comparison with our Asean peers. The previous administration spent something like 5 to 6 percent and they delivered despite the crisis.
(In) the next 20 years, we should continue to build,” he said.
Budget Undersecretary Joselito Basilio in the same forum said of the 2024 proposed budget that will go to spending on reducing transport and logistics costs, the bulk will be allocated to physical infrastructure aimed at improving connectivity throughout the country through the construction of accessible road networks and railways.
This will ensure the government will continue infrastructure spending at around 5 to 6 percent of GDP, Basilio said.
The government is proposing to spend P5.76 trillion r next year, 9.5 percent higher than this year’s allocation, and is about 20 to 21 percent of GDP.
Basilio said spending under the proposed budget will “continue to be anchored on the eight- point social economic agenda.”
Also part of the priority areas are ensuring food security, social infrastructure such as school buildings and health centers, reduction in energy costs, and social spending, apart from reducing transport and logistics costs.
Secretary Arsenio Balisacan of the National Economic and Development Authority said the infrastructure program is a catalyst to the country’s social and economic transformation.
“With a focus on delivering essential projects such as expressways, bridges, airports, railways, ports, telecommunications, and other social infrastructure, we will be able to significantly reduce the cost of doing business, expand market opportunities especially for micro, small, and medium enterprises and promote high-quality job creation and innovation,” said Balisacan in the post-SONA event.
“The prioritization of infrastructure also aligns with the strategies found in the country’s Philippine Development Plan (PDP) 2023-2028, the government’s development blueprint for the medium term. The PDP 2023-2028 lays out interventions aimed at transforming the country’s production and social sectors through the expansion and upgrading of infrastructure,” he said.
“These 194 big-ticket infrastructure projects aim to address the binding constraints to business investment and expansion. The goal is to create more high-quality and resilient jobs offering better wages to Filipino workers. This is key to significantly reducing our country’s poverty incidence to single-digit levels by 2028,” Balisacan added.
