Publication:
Growth and Productivity in the Philippines: Winning the Future

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dc.contributor.authorWorld Bank
dc.date.accessioned2018-09-26T21:29:04Z
dc.date.available2018-09-26T21:29:04Z
dc.date.issued2018-09
dc.description.abstractTo achieve the AmBisyon Natin 2040, the Philippines needs to triple its income per capita in the next two decades. The AmBisyon Natin 2040 is the government’s plan to transform the country into a prosperous middle-class society free of poverty by 2040. This implies that the Philippine economy needs to grow at an annual average of 6.5 percent in the next 22 years, faster than the average growth of 5.3 percent since 2000—a challenge that only the Asian Tigers and China have managed to accomplish in the past. This report shows that sustaining high growth can only be achieved if the Philippines succeeds in sustaining high Total Factor Productivity (TFP) growth while accelerating capital accumulation. To achieve the GDP per capita target by 2040, numerous scenarios regarding the potential mix of growth drivers were evaluated. The first key finding is that sustaining high TFP growth will be crucial to achieve the target. Specifically, the Philippines needs to sustain an average annual TFP growth rate of 1.5 percent or higher in the next 22 years, more than double the world average since 2000. Such a high rate of TFP growth will require deep structural reforms to remove constraints and distortions faced by the private sector. The second key finding is that accelerating capital accumulation in the medium term will be essential to reduce current infrastructure and capital constraints to growth. The Philippines can meet the capital accumulation requirement by doubling the growth rate in the physical investment-to-GDP ratio over the next five years through higher private and public investment, which would require the implementation of important reforms that are highlighted in this report. The top three policy reform areas for sustaining high growth and productivity, prerequisites for achieving Ambisyon Natin 2040 are: (i) improving market competition through regulatory reforms; (ii) improving trade and investment climate policies and regulations; (iii) reducing labor market rigidities and costs. By creating competitive and flexible markets, poverty alleviation is likely to accelerate through more jobs, higher labor productivity, and lower consumer prices. An equal playing field and a regulatory environment that makes it easy to do business encourage firms to enter the market, invest, grow, create jobs, and innovate, leading to higher productivity. Market competition coupled with flexible a labor market and abundant labor supply allows higher productivity to reduce product prices, which increases workers’ real income. As a result of more and higher paid jobs, more people will move out of poverty, helping achieve the AmBisyon Natin 2040 vision of a society free of poverty.en
dc.identifierhttp://documents.worldbank.org/curated/en/586871537541775427/Growth-and-Productivity-in-the-Philippines-Winning-the-Future
dc.identifier.doi10.1596/30450
dc.identifier.urihttps://hdl.handle.net/10986/30450
dc.languageEnglish
dc.publisherWorld Bank, Washington, DC
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectECONOMIC GROWTH
dc.subjectPRODUCTIVITY GROWTH
dc.subjectLABOR PRODUCTIVITY
dc.subjectGROWTH DRIVERS
dc.subjectTOTAL FACTOR PRODUCTIVITY
dc.titleGrowth and Productivity in the Philippinesen
dc.title.subtitleWinning the Futureen
dc.typeReporten
dc.typeRapportfr
dc.typeInformees
dspace.entity.typePublication
okr.crossref.titleGrowth and Productivity in the Philippines
okr.date.disclosure2018-09-23
okr.doctypeEconomic & Sector Work::General Economy, Macroeconomics, and Growth Study
okr.doctypeEconomic & Sector Work
okr.docurlhttp://documents.worldbank.org/curated/en/586871537541775427/Growth-and-Productivity-in-the-Philippines-Winning-the-Future
okr.guid586871537541775427
okr.identifier.doi10.1596/30450
okr.identifier.externaldocumentum090224b0867c3728_3_0
okr.identifier.internaldocumentum30439749
okr.identifier.report130056
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/586871537541775427/pdf/130056-WP-P165526-PUBLIC-Disclosed-9-23-2018.pdfen
okr.region.administrativeEast Asia and Pacific
okr.region.countryPhilippines
okr.topicIndustry::Industrial Economics
okr.topicInternational Economics and Trade::Export Competitiveness
okr.topicMacroeconomics and Economic Growth::Economic Growth
okr.topicSocial Protections and Labor::Labor Markets
okr.unitEast Asia and Pacific 2 (GMTP2)
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