Philippines

Overview

The Republic of the Philippines has made progress in meeting the Millennium Development Goals. It has achieved gender equality in education, reduced the mortality rate among children aged five and under, reduced the incidence of tuberculosis cases, and increased access to water and sanitation services. The country has strong potential for development because of its natural and human resources.

Nevertheless, the Philippines still ranks 112 out of 187 countries on the United Nations Development Programme's 2011 human development index. Progress is threatened by economic and social inequality, as well as by regional disparities, especially in the conflict-affected provinces of the island of Mindanao. Ensuring that social services reach the poor remains a major challenge. Women in the labour force are confined largely to low-wage, low-productivity jobs and have limited access to land ownership, credit, and training. Natural disasters such as hurricanes and floods have resulted in severe losses of life and property and have constrained efforts to reduce poverty. Almost one out of four Filipinos lives on less than US$1.25/day.

Although economic growth in the last five years has averaged around 5.1 percent, it is vulnerable, relying heavily on remittances from millions of overseas Filipino workers. These remittances fluctuated with job losses during the recent global financial crisis. At the same time, there was a reduced demand for the country's exports. The investment climate suffers from low competitiveness and a high cost of doing business.

Weak governance is recognized as a key constraint to sustained economic growth and poverty reduction in the country. However, as a strong democratic republic, the government has been able to initiate a number of governance reforms. The Philippines has a vibrant private sector and an active civil society, both important partners in development.

Thematic Focus

CIDA's program is aligned with the Medium-Term Philippine Development Plan.

The goal of CIDA's program in the Philippines is to support sustainable economic growth by improving the climate for investment and protecting the economic interests of the poor.

Economic growth

CIDA helps the Philippines strengthen the investment climate by working with national and local governments to:

• Simplify business regulations and processes
• Improve sector-specific value chains, that is the full range of activities to bring a product from an idea to production, to delivery, to consumers, to disposal after use
• Help selected local government agencies implement their economic development plans

In order to protect the economic interests of the poor, CIDA is working to increase the capacity of government and non-government organizations to deliver programs and services that help poor women and men entrepreneurs:

• Develop business skills
• Increase productivity
• Improve access to financing and markets

Progress on Aid Effectiveness

The Philippines adheres to the Paris Declaration on Aid Effectiveness (PDF, 317 KB, 23 pages) and has taken steps to improve donor alignment and harmonization, strengthen local ownership, and integrate results-based management systems. CIDA is helping to strengthen government procurement systems and is participating in joint donor activities.

Economic growth

• Helped create 1,600 jobs through advice to small businesses
• Helped 7,000 farmers in 42 rural communities increase their income, productivity and access to markets
• Helped three banana farms receive Rainforest Alliance certification, allowing access to premium markets
• Reduced average production cost for organic rice farmers from 20,000 pesos per hectare for conventional farming to 11,000 pesos for organic farming, increasing productivity and income of poor farmers
• Created a small to medium enterprise banking unit and disbursed more than $373,000 to 66 new clients between 2005 and 2011

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