Building infrastructure is certainly the key to economic growth, the creation of jobs and eradicating poverty. The Asian Development Bank in a report Tuesday stressed that emerging economies across Asia should invest as much as $26 trillion on building everything from transport networks to clean water through 2030.
US President Donald Trump chimed in, pledging to bring one trillion dollars in public and private investment to rebuild what he called America’s crumbling infrastructure in a speech to a joint session of Congress this week. Trump’s commitment was one of his main campaign pledges—rebuild America’s roads, bridges, airports and other public structures.
China-backed Asian Infrastructure Investment Bank, meanwhile, has also begun funding projects as an alternative financing institution to the World Bank and ADB.
Here in the Philippines, President Rodrigo Duterte has embarked on an ambitious $160-billion infrastructure plan as he seeks to sustain growth of about 7 percent, among the fastest in the world. The Duterte administration early on allocated P8.2 trillion to finance the “golden age of infrastructure” during his term.
The massive infrastructure program of the Philippines requires huge funding from multilateral institutions, the government budget and the private sector. Investments from private companies will be critical to achieve the goal and President Duterte will need all his charm to woo foreign firms and institutions to support the gargantuan effort.
The Philippines, like the rest of emerging economies in Asia, has little choice but to build more roads, airports, bridges and other public structures to meet the demands of an increasing population.
Additional roads and bridges will link the rural areas and their produce to the market, usually situated in the urban centers. An established market, in turn, will serve as an incentive to farmers and fishermen to increase their output. Similarly, bigger and modern airports and seaports will speed up the flow of goods and attract local and foreign tourists, who directly contribute to job generation in the host communities.
Infrastructure projects produce a virtuous cycle that sustains economic growth. The Philippines should not waste time nor dilly-dally on projects that should have been built decades ago.