'Ghost projects' cloud gov't infra progress

The massive corruption scandal involving “ghost” flood control projects has cast a shadow over what has otherwise been a period of substantial infrastructure progress in the Philippines, according to London-based think tank Capital Economics.

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In an Oct. 9 report, Capital Economics senior Asia economist Gareth Leather said the controversy has raised governance concerns that threaten to undermine confidence in the government’s infrastructure program.

The report noted that the Philippines has seen significant improvements in roads, ports, and digital connectivity over the past decade, enhancing competitiveness and supporting its goal of becoming a regional manufacturing hub.

“Poor infrastructure has long been a constraint on growth in the Philippines,” the think tank said, explaining that it raises transport and logistics costs, deters investment, holds back productivity, and makes it more expensive for domestic firms to reach overseas markets.

“The tide has begun to turn. The country has made significant headway over the past decade or so in addressing this critical bottleneck,” the think tank added.

“The recent corruption scandal involving flood control projects has dealt a blow to confidence in the government’s infrastructure agenda,” the report said, although it acknowledged that “there have been real, tangible improvements on the ground.”

Capital Economics also said the country’s infrastructure drive began under the Benigno Aquino III administration from 2010 to 2016, accelerated under President Rodrigo R. Duterte’s “Build, Build, Build” program from 2016 to 2022, and has been sustained under President Ferdinand R. Marcos Jr. through the “Build Better More” initiative.