Jeremias L.

Fernandez II HRT-31
Philippine Development Plan 2011

The National Economic and Development Authority (NEDA) is currently holding consultations in various
regions in the country in preparation for the Medium-Term Philippine Development Plan (MTPDP) 2011-2016
as mandated by Memorandum Circular No. 3 issued in September 2010.
The MTPDP 2011-2016 embodies the goals, objectives, and strategies of President Benigno Aquino’s “Social Contract
with the Filipino People.” According to NEDA National Planning and Policy Staff OIC-Director Myrna B. Asuncion,
the regional consultations are being held to ensure wide participation in the planning process. Asuncion added that
regional inputs are essential in the plan. Initial inputs and concerns were integrated in the draft MTPDP which is also
being presented to various stakeholders during regional consultations. Heads and representatives from the regional line
agencies, local government units, legislative office, government-owned and controlled corporations, business groups,
academe and civil society organizations are expected to participate in the regional consultations. Earlier, the
Metropolitan Manila Development Authority (MMDA) led a three-day annual workshop on the regional development
plan for the National Capital Region.The “Social Contract with the Filipino People” of President Aquino envisions a
country that has achieved inclusive growth. This rapid growth, sustained and broad-based and gives attention to the
creation of more jobs and new opportunities to achieve full employment and significant reduction in poverty. Policies
and strategies of the country’s development plan shall focus on: attaining a high and sustained economic growth that
provides productive employment opportunities; accessing development opportunities across geographic areas, different
income and social spectrum; and implementing effective and responsive social safety nets to catch those who will be
left behind by the character of a high sustained growth.The MTPDP 2011-2016 consists of nine chapters:

Macroeconomic Policy For the period 2004–2009, major reforms were undertaken to improve the revenue situation
such as the reform of the excise tax on alcohol and tobacco, an expansion in the base of and an increase in the rate of
the value-added tax and the enactment of the Lateral Attrition Law. These increased tax effort from 12.5 percent in
2004 to 14.2 percent in 2008. Deficit fell from 3.9percent of GDP during the period 2000-2004 to 1.1 percent in 2006
and to a almost balanced position of 0.2 percent in 2007. Likewise, the consolidated public sector financial position
reached a surplus of P21.3 billion, or 0.3 percent of GDP, in 2007 from a deficit of Php235.9 billion, or 5.0 percent of
GDP in 2004

Competitive Industry and Services Sectors The services sector accounts for around half of the country’s gross
domestic product (GDP) with wholesale and retail trade as the strongest performer followed by transport,
communication and storage; and private services. The share of the sector in total exports has been increasing as the
country has become one of the world’s top outsourcing destinations. Travel, other business services, as well as
computer and information services are significant contributors to total services exports. Around half of total
employment is accounted for by the sector with wholesale and retail trade accounting for the biggest chunk of services
employment. However, less than half of total domestic and foreign investments have gone into the services sector with
a big portion of these investments going to the finance and real estate subsectors. With the demand for services
increasing all over the world, there is room for the sector to improve and continue to grow.

Competitive and Sustainable Agriculture and Fisheries, The Agriculture and Fisheries Sector remains an important
contributor to the economy,with a contribution of 18.1percent to GDP and employed 34.3 percent of the labor force in
2009. The sector grew 3.2 percent on average over the last 5 years, but below the target of 4.3-5.3 percent.There were
gains in terms of agricultural labor productivity, with annual average gains of1.6 percent in the last 5 years. Major
drivers of growth are banana, corn, fisheries, agriculturalservices and palay. In comparison with selected Southeast
Asian countries, land productivity and costcompetitiveness of traditional crops, e.g., rice, corn and sugarcane ranked
low, but rated higherwith high value crops like banana. Export value was at its lowest in 2009, as the
Philippinescontinue to be a net importer with a trade deficit of $2.4 billion. Positive trade balance for highvalue crops
(e.g., vegetable and fruits) and fisheries, however, was evident.

Accelerating Infrastructure Development, The infrastructure development program of the government aims to
contribute to inclusive growth and poverty reduction. By providing safe, efficient, adequate, reliable, cost-effective, and
sustainable infrastructure, it will support the growth of various sectors of the economy. In the same manner, it will enhance
beneficiaries’ access to goods and services.
Financial Sector Development and Capital Mobilization, The Philippine financial system appears resilient and
supportive of economic growth post crisis. The banking system, which remains the core of the
financial system and the primary source of credit for the economy, has been largely unaffected
by the 2007-2008 global financialcrisis. This is on account of the sustained implementation of
financial sector reforms and an improved macroeconomic environment. Banks are well-
capitalized in line with international standards. They likewise remain highly liquid, with
improving asset quality and core earnings. Compared with ASEAN-5, the Philippine banking
system has been largely sound and stable, and its performance has been at par with those of
its regional peers.

Good Governance and the Rule of Law, The quality of governance in the country is generally weak. In the 2009
Worldwide Governance Indicators (WGI), the country’s percentile rank in the six dimensions of governance (i.e., voice
and accountability; political stability; government effectiveness; regulatory quality; rule of law; and control of corruption) is
mostly within the lower half. This can also be said of the preceding years.

Social Development The social development sector, in recent years, has generally, shown improved
access to and quality of service delivery in health, nutrition and population; education, training and
culture; housing; social protection; and asset reform efforts and initiatives. The Philippines,
however, is still lagging behind in meeting the Millennium Development Goals (MDGs) for
education, health, nutrition, and poverty reduction.

Peace and Security and Conservation The national security environment is faced with both internal and
external threats that continue to impact on national development, human security and the
promotion of general welfare. These threats include the prolonged internal conflicts with armed
groups as well as those brought about by the new global security environment, notably, terrorism,
human trafficking, illegal arms trade, and drug trafficking. Recently, the effects of a changing
climate and pandemics have posed serious challenges to the country’s development. The
challenge is in ensuring an environment where national development and general well being are
attained.

Protection and Rehabilitation of Environment and Natural Resources towards Sustainable Development, The
extent of the Philippine’s natural environment supports a wide variety of habitats and ecosystems, and these resources
have substantial economic value. It supports the agriculture, fisheries and forestry (AFF) sector which accounted for
18.1 percent of total GDP in 2009. However, lack of protection and improper use over the years brought about the
deterioration of the natural ecosystems that support these resources. The poor state of the country’s environment and
natural resources is felt most intensely by the poor, especially the rural communities which remain the poorest in the
country. The strong link between poverty and environmental degradation cannot be denied as for these poor
communities, continuous degradation of these resources is a threat to life itself. This situation of poverty and
environmental degradation is aggravated by climate change. The following section provides a situationer of the current
state of the country’s environment and natural resources and the different strategies so far implemented.