The PHP18.18 billion budget being proposed by the Department of Information and Communications (DICT) for 2021 will boost telecommunications infrastructures across the country and expand the beneficiaries of the government initiative for free Wi-Fi.
This is the biggest budget the DICT is seeking by far to address the challenges in connectivity in the face of increasing demand for internet use and shift to digital services because of the pandemic.
The DICT proposal bodes well with the recommendation of the World Bank urging the Philippines to ramp up capital expenditures to improve telecommunications services with better infrastructure and wider coverage, as it noted that government should take a lead in transitioning to digital economy.
“In a society-wide digital transformation, the government itself must lead by example,” said World Bank economist Kevin Chua, lead author of the report “A Better Normal Under COVID-19: Digitalizing the Philippine Economy Now,” which was released by the World Bank and the National Economic and Development Authority.
The DICT has explained to Congress that the PHP18.18 billion budget would enable it to activate a cable landing station in Baler in Aurora province and connect the National Grid Corporation of the Philippines (NGCP) node in San Fernando, La Union. This will enable the department to fire up four DICT nodes and 15 NGCP nodes, thereby expanding the bandwidth to nearby government clients and beneficiaries of free Wi-Fi under the National Broadband Program.
The technical rollout of DITO Telecommunity, the country’s third major player, should also help in the country’s goal of digitalization. With more than 1,000 cell sites currently being constructed and 1,200 planned base stations on air by January 2021, the delivery of favorable communications services to consumers among the country’s top telcos is expected to improve next year.
Combined this with increase in capital expenditures of telco giants Globe Telecom (US$1.6 billion) and Smart (PHP70 billion) to improve their capacity and coverage, the DICT is projecting internet speed to hit 55 Mbps in July 2021.
The Philippine government’s expenditure, however, still pales in comparison to other countries, according to the World Bank, with China investing US$289 billion for telco infrastructure in the last four years; Japan’s annual ICT spending of US$162 billion; and South Korea’s US$24 billion for its internet backbone.
In neighboring ASEAN (Association of Southeast Asian Nations), Vietnam tops infrastructure development spending with US$820 million for a 23,000-km submarine cable system; followed by Thailand’s US$343 million to ensure internet broadband connectivity to thousands of villages; and Malaysia’s US$233 million to boost broadband speed and coverage.
President Rodrigo Duterte has called on telco operators in the country to improve their services and the Department of the Interior and Local Government to crack the whip of local government units impeding the issuance of permits for the construction of telco towers around.