The government’s flagship nautical highway system is a double-edged sword for regional development, as it provides boost to port-hosting towns while simultaneously triggers economic declines in neighboring areas, according to a new study from the Philippine Institute for Development Studies (PIDS).

In a discussion paper released Jan. 6 titled “Can Transport Infrastructure Reduce Inequality in Archipelagic Economies? Evidence from the Philippine Roll-on/Roll-off Network,” researchers Kris A. Francisco and Kimberly R. Librero argued that while the Roll-on/Roll-off (RoRo) terminal system is a vital tool for integration, it remains “necessary but insufficient” to achieve widespread prosperity.

The findings challenge the long-held assumption that simply building connectivity infrastructure will automatically lift all surrounding communities out of poverty. The state-run think tank identified a stark “geographic pattern of winners and losers” created by the network.

While municipalities that host RoRo ports enjoy concentrated economic gains, the report found that neighboring municipalities experienced an average 6.5 percent decline in income. This suggests that the infrastructure may be centralizing economic activity at the expense of more distant or less-connected areas, rather than distributing wealth evenly across the archipelago.

Beyond direct income shifts, the researchers also observed significant pressure on the cost of living.

The study noted that RoRo integration drives property tax increases that peak at 35 percent roughly 14 years after the infrastructure is established. This lag in property value appreciation presents a looming threat for low-income residents who may face displacement due to rising housing costs and taxes.

To counter this, the PIDS urged the government to implement proactive measures such as rent controls, tax relief, and affordable housing programs.

The economic data showed that while the RoRo network successfully boosted business growth—leading to a 17 percent increase in tax revenue—this fiscal windfall did not translate into a significant reduction in poverty.

The researchers concluded that the labor market remains segmented, preventing the most vulnerable populations from accessing new opportunities. They suggested that for infrastructure to become a tool for equity, it must be paired with aggressive skills training and job placement services, alongside support for the informal business sector.

The PIDS emphasized that the full effects of such massive infrastructure projects often take 12 to 15 years to materialize. This long-term horizon requires a sustained policy commitment that spans multiple administrations.

The authors argued that the current lag in impact provides a narrow window for policymakers to redirect economic patterns and implement complementary policies before regional inequalities become too entrenched to reverse.

Future projects must integrate these distributional considerations into the initial design phase rather than treating social welfare as an afterthought, the report said.