(MENAFN- Gulf Times) Manila Times/Makati
The Duterte administration is 'on track to complete the infrastructure projects under the ‘Build, Build, Build' programme, Budget Secretary Benjamin Diokno said, but warned that Filipinos will have to bear with added inconveniences 'before things get better.
'Our plan is to complete the flagship projects before the end of the term of the Duterte administration, Diokno said in a speech during The Manila Times 6th Business Forum at the Marriott Hotel in Pasay City on Friday.
In a private chat with The Manila Times editor-in-chief Nerilyn Tenorio before his speech, Diokno said: 'Build, Build, Build is on track. People should not be impatient.
Diokno was reacting to comments from Forum delegates around the table that they haven't seen a flurry of construction activities around the country that one would expect from the much-talked about ‘Build, Build, Build' strategy under the 'Dutertenomics policy.
'The Golden Age of Infrastructure will not happen overnight but we assure [our people]that we are fully invested in this ambitious goal, he said in his speech.
'We will be spending P8 to P9tn on these projects over the medium term.
Infrastructure spending will rise from an equivalent of 5.3% of gross domestic product (GDP) in 2017 to as high as 7.4% of GDP in 2022, he added.
The government has packaged its infrastructure ambitions under the triple-B programme, tapping overseas development assistance and other concessional loans for projects that, after completion, will be offered to the private sector via management contracts.
'For this year alone, P858bn or 5.4% of GDP has been allocated to infrastructure development, he said.
Next year, 'we are going to spend P1.1tn more that's for 2018 alone, Diokno said.
Seventy-four flagship projects have been identified and total costs have been estimated to reach P9tn over President Rodrigo Duterte's six-year term.
Of the flagship projects, 18 valued at P462.74bn have been approved by the National Economic and Development Authority (NEDA) board chaired by Duterte. A primary focus involves developing modern transport systems, roads and bridges, airports and seaports.
Flood control, communication and information, as well as new cities are being prioritised.
Another aim is that of job creation and unlocking growth across the country.
One project that is likely to remain uncompleted once Duterte steps down is the proposed Mega Manila Subway, which Diokno said would take 10 years to complete.
'Maybe if it will have 10 stations, we can finish five. But definitely we cannot complete it, he said.
Ramped-up government spending on infrastructure is going to weigh on the national budget deficit, which Diokno said has been allowed to widen to as much as 3% of GDP annually, as agreed with lender International Monetary Fund (IMF), from about 2.6% in previous years.
'In May last year, before the Duterte administration took power, I talked to the IMF and I said I wanted to expand our deficit-to-GDP ratio from 2% to 3%, he said. Diokno said the original plan of the government was to have a 3% deficit-to-GDP ratio of 3% from 2017 to 2019 and 2% from 2020 to 2022, to show some fiscal conservativeness, but the IMF said, 'No, go to 3 % during the entire term.
The government intends to make up for the shortfall in the budget by reforming its tax structure.
Under the tax reform bill approved by the Lower House but pending with the Senate, income tax would be cut to 25% from the current 32%.
'But we are going to recover this by taxing petroleum products, Diokno explained.
To avoid the underspending that had characterised the previous administration, President Rodrigo Duterte has urged his department secretaries to use their budget allocations for projects that would boost economic growth.
'The president kept telling us: ‘Spend your budget or lose you job,' Diokno said, quoting Duterte as saying to his Cabinet.
Traffic to worsen In the coming years, however, the public will have to bear with congestion and increased traffic while the government works on the projects round the clock, the Budget secretary warned.
'We will implement 24/7 construction, but it will get worse before it gets better, he said.
Non-stop construction will be adopted next year and will be mandated in contracts that are up for implementation, Diokno said.
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