WASHINGTON, DC, April 30, 2009 — The World Bank Group’s Board of Executive Directors discussed today the new Country Assistance Strategy (CAS) for the Philippines for Fiscal Years 2010-2012. With a central goal of achieving growth that works for the poor, the World Bank Group (WBG) will support the Philippines in pursuing macroeconomic stability, an improved investment climate, better public service delivery for the poor, reduced vulnerabilities to income shocks and natural disasters, and better governance.
Addressing the country’s fundamental development challenges, the new CAS focuses on poverty alleviation measures and on operationalizing governance in all Bank-supported activities. It also addresses emerging global challenges such as climate change, disaster risk management, and the financial crisis and emphasizes a knowledge agenda that supports the Philippines in addressing its own development challenges.
According to World Bank Country Director Bert Hofman, this strategic focus mean Bank support for reforms, programs, and projects that improve opportunities, especially of the poor, to participate in markets through strengthened human capital (good health and better education), reduced vulnerability to shocks, and more economic prospects. Said Mr. Hofman,“This CAS continues the Bank’s support for the country’s development objectives. We hope to do more for poverty alleviation measures, not only because poverty reduction has been lagging, but also because the poor are most vulnerable to the impact of the global recession.”
Finance Secretary Margarito Teves said that the new CAS supports the current thrust of the government to increase public expenditures and provide greater assistance to the very poor and sustain a respectable level of economic growth despite the global crisis. “We thank the Bank for its continued support to the country’s development objectives and for allowing flexibility under the new CAS, which could help strengthen the country’s ability to deal with the current global financial and economic crisis,"Secretary Teves said.
The new CAS pilots deeper integration of the operations of World Bank and the International Finance Corporation (IFC), the private sector financing arm of the WBG. The Bank is prepared to provide support amounting to US$700 million to US$1 billion per year for the next three years, coupled with a robust program of analytical and advisory activities. IFC’s program would be in the range of US$250-US$300 million per year. Specific areas of joint IFC and Bank collaboration are in infrastructure, agribusiness, and the financial sector. Another member of the World Bank Group, the Multilateral Investment Guarantee Agency (MIGA), will provide guarantees to foreign investors against losses caused by non-commercial risks, as well as technical assistance to help countries disseminate information on investment opportunities.
According to IFC Resident Representative Jesse Ang, the IFC has developed instruments to help private firms deal with increased risk and liquidity constraints arising out of the global economic crisis.
These instruments include the Bank Capitalization Fund that provides equity funds to capitalize banks, the Expanded Trade Finance Program that guarantees trade-related payment obligations of financial institutions, the Infrastructure Crisis Facility that bridges the financing gaps in privately funded infrastructure projects facing financial difficulties, and the Global Microfinance Initiative that assists the microfinance sector serving the needs of small and micro enterprises in the Philippines.
“IFC’s financial instruments are intended to help strengthen the private sector in dealing with the global crisis, upgrade vital infrastructure, generate jobs by supporting small and micro enterprises, and create more opportunities for the poor, especially those who are most affected by the economic distress,”Mr. Ang said.
Socioeconomic Planning Secretary Ralph Recto welcomed the new CAS, saying that the new framework for the World Bank Group’s operations in the Philippines is broadly aligned with the country’s updated Medium Term Philippine Development Plan (MTPDP) prepared by the National Economic and Development Authority (NEDA).
The MTPDP focuses on growth and job creation, energy, education, health, youth opportunity, anticorruption, and good governance. “I welcome the Bank’s continued support for the Government’s MTPDP, to which the CAS is well aligned. The MTPDP also gives priority to protecting the poor through a host of social policy measures including shelter, health insurance, low-cost medicines, and cash transfers,” said Secretary Recto, who is also the Director General of NEDA.
Philippines Country Assistance Strategy FY10-12: Core Results Areas
The World Bank Group’s engagements in support of the four CAS strategic objectives and one cross-cutting theme will help the achievement of key results in line with the Philippines’ medium term development goals in eleven core results areas, as follows:
Stable Macro Economy: Maintenance of fiscal and financial stability through increased tax revenues, improved allocation and transparency of public expenditures, and stronger management of fiscal and financial sector risks including better statistics.
Improved Investment Climate:
An enabling environment fostering competitiveness, productivity, and employment with increased and improved provision of infrastructure, an enhanced regulatory policy framework and institutional capacity supporting private investment and trade, and increased investment and employment in rural and urban development;
Enhanced financial services with better access and delivery of credit and other financial products, particularly for underserved sectors and clients.
Better Public Service Delivery:
Strengthened public service delivery in key sectors such as better access to and quality of basic education, improved health services, and greater household access to water and sanitation services;
Scaled-up and enhanced basic service delivery in poor areas through a nationwide community driven development (CDD) program, and through more coordinated area based approaches.
Reduced Vulnerabilities:
Strengthened social protection systems based, among others, on a national poverty targeting mechanism, the operationalization and implementation of a Conditional Cash Transfer (CCT) program, which also addresses the reversal of deteriorating social indicators;
The addressing of disaster risks and related climate change issues through an operational risk management and financing strategy, the initiation and expansion of climate change adaptation programs in key sectors and at the local government level;
Attention to issues of stability and peace in addressing the development needs of communities affected by armed conflict, including in Mindanao, with enhanced conflict-sensitive programs, and scaled-up delivery of basic services and livelihood support through the CDD approach.
Good Governance:
Addressing the issues of governance and anticorruption in selected national agencies through improved core business systems, processes, and capacities;
Implementation of reforms and strengthening of procurement and public financial management;
Better governance through more effective and deepened decentralization focusing on broad-based reforms, and stronger performance of Local Government Units in effectively delivering services.
XXX
For information on the World Bank’s projects and programs in the Philippines, please visitwww.worldbank.org.ph
RSS