Gov't infra spending poised to surpass target in 2023
At A Glance
- The Development Budget Coordination Committee (DBCC) projects total infrastructure expenditures for 2023 to reach P1.424 trillion, a 10% increase over the P1.293 trillion program.<br>This projection exceeds last year's actual infrastructure spending of P1.278 trillion by 11%.<br>If achieved, the level of infrastructure spending will match 5.8% of the country's gross domestic product (GDP), mirroring last year's ratio.<br>The DBCC's projection for 2023 exceeds the P1.408 trillion target for the following year, equivalent to only 5.2% of GDP.<br>The Marcos administration aims to maintain its infrastructure spending at 5-6% of GDP annually, amounting to around P1.3 to P2.3 trillion each year until 2028.<br>Finance Secretary Benjamin E. Diokno highlighted the high multiplier effects of infrastructure investments, which are at the top of President Marcos' agenda.<br>Under the president's Build Better More program, the government plans to invest in 197 infrastructure projects worth P8.7 trillion, with about 41 to be financed through public-private partnerships.<br>Government infrastructure spending averaged just 2% of GDP from 2001 to 2015, indicating historical underinvestment in this sector.
Efficient implementation of catch-up plans has positioned the Marcos administration to exceed its infrastructure spending target for this year, data from the Development Budget Coordination Committee (DBCC) showed.
The DBCC, an inter-agency body responsible for setting the government’s macroeconomic assumptions, projects that total infrastructure expenditures for 2023 will reach P1.424 trillion, a 10 percent increase over the P1.293 trillion program.
The DBCC's projection also exceeds last year's actual infrastructure spending of P1.278 trillion by 11 percent.
If realized, the level of infrastructure spending will correspond to 5.8 percent of the economy, as measured by the country’s gross domestic product (GDP), matching last year’s ratio.
The 2023 DBCC outlook even surpasses the P1.408 trillion target for the next year, which represents only 5.2 percent of the GDP.
Finance Secretary Benjamin E. Diokno said that infrastructure investments, which have significant multiplier effects on the economy, are a top priority on President Marcos’ agenda.
The Marcos administration's goal is to sustain annual infrastructure spending at five percent to six percent of the GDP, amounting to around P1.3 to P2.3 trillion each year until 2028.
As part of the president's flagship Build Better More program, the government has outlined plans to invest in a total of 197 infrastructure projects amounting to P8.7 trillion.
Notably, approximately 41 of these key projects are set to be financed through public-private partnerships.
"We are committed to reverse the decades-long underinvestment in infrastructure," Diokno said, highlighting that government spending on infrastructure averaged just two percent of GDP from 2001 to 2015.
In the initial months of 2023, the national government experienced difficulties in implementing its projects, resulting in spending below the set targets, which in turn contributed to a slowdown in economic growth in the second quarter.
In response, President Marcos directed government agencies to devise catch-up plans for the remainder of the year to help bolster the country's faltering economic growth.