The Philippines actively sought bolstered assistance from the Asian Development Bank (ADB) to advance its dual objectives of physical and digital infrastructure development.
During the 57th ADB Annual Meeting’s Business Session, Finance Undersecretary Joven Balbosa emphasized the nation’s focus on fostering improved connectivity to amplify infrastructure investments.
Empowering small businesses
Acknowledging the vital role of micro, small, and medium enterprises (MSMEs) in the country’s economic fabric, the Philippines underscores the necessity for tailored support from the ADB. With MSMEs constituting nearly 99% of the nation’s business sector, there’s an urgent call for initiatives to bolster their capacities, particularly in light of the pandemic’s disproportionate impact on this segment.
According to the 2022 List of Establishments (LE) by the Philippine Statistics Authority (PSA), there were 1,109,684 active business enterprises in the country. Among these, a significant majority, 1,105,143 (99.59%), were categorized as MSMEs, while 4,541 (0.41%) were classified as large enterprises. Specifically, micro-enterprises accounted for 90.49% (1,004,195) of the total, followed by small enterprises at 8.69% (96,464) and medium enterprises at 0.40% (4,484).
In the same year, the landscape of MSMEs in the Philippines was dominated by five key industry sectors. Topping the list was Wholesale and Retail Trade, including the Repair of Motor Vehicles and Motorcycles, boasting a staggering 546,863 establishments. Following closely behind were the sectors of Accommodation and Food Service Activities, with 158,113 establishments, and Manufacturing, with 133,504 establishments.
Additionally, Other Service Activities comprised 71,145 establishments, while Financial and Insurance Activities rounded out the top five with 50,782 establishments. These sectors collectively represented a substantial portion, approximately 86.90%, of all MSME establishments in the country.
Charting a comprehensive country strategy partnership
In pursuit of a robust development trajectory characterized by inclusivity, climate resilience, and competitiveness, the Philippines advocated for a crafted Country Strategy Partnership (CPS) with the ADB. The new CPS will cover 2024 until 2029.
Emphasizing the importance of aligning this partnership with national development goals, the Philippines aims to leverage ADB’s expertise in navigating complex challenges and fostering sustainable growth.
“We encourage the ADB to further strengthen its support in enhancing physical and digital connectivity that will increase infrastructure investments. There is an enormous opportunity for ADB to develop and improve the capacities of our micro, small, and medium enterprises,” Balbosa said during the event.
Fostering digitalization and human capital development
Recognizing the pivotal role of digitalization in driving economic progress, the Philippines underscored the ADB’s significance in advancing its digital transformation agenda.
Moreover, Balbosa emphasized the criticality of bolstering human capital, particularly in sectors such as education and nutrition, to fortify the foundation for long-term sustainable development.
Maximizing development financing
With the Philippines emerging as a significant beneficiary of ADB support, the Finance Undersecretary advocated for the scaling up of efforts to finance long-term sustainable development priorities.
Emphasizing the imperative of addressing persistent challenges such as gender disparities, climate vulnerability, and poverty rates, the official said the Philippines looks towards the ADB to augment its operational capacity and financial resources.
Streamlining project implementation
To expedite project execution and ensure alignment with domestic regulatory frameworks, the Philippines urged the ADB to revisit and streamline its safeguards standards and policies.
By enhancing the efficiency of project implementation processes, both parties aim to optimize the impact of development initiatives and address multifaceted challenges in the global development landscape.
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