In Focus Archived (November 2013)

The latest poverty statistics released by the National Statistical Coordination Board (NSCB) have attracted considerable attention as they clearly show that the country has still got a long way to go in its fight against poverty. There is no significant reduction in poverty incidence as of the first semester of 2012 compared with 2006 and 2009 figures from the triennial Family Income and Expenditure Survey (FIES). The NSCB estimated poverty incidence at 27.9 percent of the population during the first half of 2012, a figure not statistically different from the rate of 28.6 recorded in 2009.

PIDS has made groundbreaking research on the complex nature and multidimensional aspects of poverty. It has also helped to enhance poverty measurement which is critical for the government in carrying out the task of poverty reduction. Who and where are the poor? How is the poverty line drawn? Beneath aggregate poverty measures, there is "chronic" and "transient" poverty, and different kinds of interventions are needed to effectively target each type. There is still much leeway to tighten the eligibility criteria for poverty-reduction programs such as the Pantawid Pamilyang Pilipino Program, the Philippine version of conditional cash transfers.

Find out more about PIDS studies on poverty. Understand the issues behind poverty measurement, dynamics of poverty, poverty's relation to agriculture, trends in income and poverty distribution, evaluation of poverty situation, effectiveness of government poverty-reduction programs, among others. The ultimate goal of development is to significantly reduce the ranks of the poor, an objective that, more than anything else, requires evidence-based policymaking.

  1. Issues on Counting the Poor

  2. Reading between the Poverty Lines: Revisions in the Official Poverty Thresholds

  3. Poverty and Agriculture in the Philippines: Trends in Income Poverty and Distribution

  4. Dynamics of Poverty in the Philippines: Distinguishing the Chronic from the Transient Poor

  5. Expanding Social Health Insurance Coverage: New Issues and Challenges

  6. Understanding the Recent Rise in Poverty Incidence: a Look at Growth and Income Distribution Effects

  7. Are We Winning the Fight against Poverty? An Assessment of the Poverty Situation in the Philippines

  8. Pantawid Pamilyang Pilipino: Why Deepening Matters in Achieving Its Human Capital Objectives

  9. Promoting Inclusive Growth through the 4Ps

  10. Conditional Cash Transfer Program in the Philippines: Is It Reaching the Extremely Poor?

Competition is a touchy subject in the developing world. In the Philippines, the unvarnished truth is that there is hardly a culture of competition. Protectionist tendencies, often with political backing, are powerful enough to block the entry of other economic players-local or foreign. Even in the domestic market, there is a raft of anticompetitive practices that make it doubly harder for new entrants to penetrate retail channels. Regulatory capture exacerbates market failures so there is a need to improve the regulatory regime. This may be addressed by having a competition policy framework that has appropriate regulation as a subset.

Resistance to competition persists mainly because its benefits are not fully understood by stakeholders, in particular consumers and businesses. As PIDS Vice-President Rafaelita Aldaba notes, the Philippines has been left outside the league of East Asian successes due to lack of investments, which, in turn could be attributed to weak competition. Local players have shied away from making additional investments due to poor governance and regulatory mechanisms and other factors like inadequate infrastructure. A PIDS study has found evidence of moderately to highly widespread incidence of unfair trade practices, a clear reflection of anticompetitive behavior. Unfortunately, aggrieved parties are often hesitant to pursue legal remedies due to gaps in legal mechanisms. The area of consumer protection is where competition reforms could bear much fruit.

PIDS has long taken the lead in the advocacy for the enactment of comprehensive competition laws as well as the adoption of a national competition policy. In the early 2000s, it embarked on a research project under the Philippine APEC Study Center Network to study the state of competition and the reforms that have been undertaken in selected industries where competition appears to be crucial: manufacturing, cement, oil, telecommunications, air transport, and banking and insurance. Over the years, the Institute, through its trade specialists such as Senior Research Fellow Erlinda M. Medalla, has continued its policy research work on competition reforms.

Check out PIDS research on competition law and competition policy. Know more about the prevalence of unfair trade practices in the country, competition and infrastructure regulation, and the state of competition in the different economic sectors. Recently, PIDS was tapped to join the "Competition Reforms in Key Markets for Enhancing Social and Economic Welfare in Developing Countries" or CREW Project spearheaded by India's Consumer Union and Trust Society (CUTS) International, an undertaking that is expected to raise and sustain public support for much-needed competition reforms.

You may access these studies via the SocioEconomic Research Portal for the Philippines by simply typing 'competition policy' in the Search box.

  1. Perceptions and Laws on Unfair Trade Practices in the Philippines

  2. Unfair Trade Practices in the Philippines

  3. Trade Liberalization and Trade Performance in Asia: 1974-2008

  4. Interface Between and Infrastructure Regulation in the Philippines

  5. State of Competition in the Wholesale and Retail Sector

  6. Toward a National for the Philippines

  7. Competition: What Is It All About? (First of two parts)

  8. : Why Does It Matter? (Second of two parts)

One of the inevitable consequences of economic growth is rapid urbanization. The developing world has seen the emergence of megacities, which are vital hubs of economic activity but are beset with problems such as mushrooming slums, worsening pollution, heightened disaster risks, and growing social inequality. Manila is already the 15th largest city in the world in terms of population density and will be among 21 megacities in Asia out of 37 worldwide by 2025, according to the Asian Development Bank (ADB). A recent ADB report noted that 60 percent of the Philippine population is now urban. Greater Metro Manila alone contains 33 million people. While poverty trends are declining in urban areas, many are just above the poverty line and remain vulnerable to shocks.

Key to reaching the goal of inclusive growth is addressing the challenges brought by urban development, such as providing adequate and affordable housing for the low-income sector. Research by PIDS experts points to the need to rationalize government subsidies and create favorable environment for housing finance. There is also a need to adopt appropriate and effective policies and mechanisms to correct dysfunctions in the land and housing markets. To make housing more accessible to low-income households, there are other viable options such as rental arrangements. The Philippines needs to build one million homes annually to keep up with the demand, estimated at 5.7 million units for the period 2011-2016.

Know more about what PIDS studies have to say about housing and urban development issues. Understand the dynamics of housing demand, issues about rent control, the efficiency of state resettlement programs, the fiscal costs of housing subsidies, and urban development policy options. Check the following links on the PIDS website's publications section or the SocioEconomic Research Portal for the Philippines.

  1. Housing policy for the poor: revisiting UDHA and CISFA

  2. Community-based approaches toward upgrading of informal settlements: Alternative strategies and recommendations for policymaking

  3. Toward a Strategic Urban Development and Housing Policy for the Philippines

  4. Fiscal costs of subsidies for socialized housing programs: an update

  5. Efficiency and Effectiveness Review of the National Housing Authority Resettlement Program

  6. Rental housing: Opening doors for low-income household

  7. The Dynamics of Housing Demand in the Philippines: Income and Lifecycle Effects

  8. Benefits (and Losses) from Rent Control in the Philippines: An Empirical Study of Metro Manila

You may access these studies and more via the SocioEconomic Research Portal for the Philippines by simply typing 'poverty' in the Search box.

The road to inclusive growth can start with education. Human resource is the backbone of the economy, and a well-trained, highly competitive workforce is key to increased productivity and national competitiveness. Education can promote inclusive growth but can also be a purveyor of inequity if left unguided.

Research by PIDS is helping inform policy by showing how education can help break the cycle of intergenerational poverty. For instance,
PIDS has found that the government's conditional cash transfer program - the Pantawid Pamilyang Pilipino - has been successful in improving school
attendance among poor households. An alternative pathway to tertiary education - technical and vocational skills training=is being offered by the Technical Education
and Skills Development Authority (TESDA). Scholarships such as those managed by TESDA and the Commission on Higher Education (CHED) have shown internal
efficiency based on graduation rates. Gaps and inefficiencies remain, however. For instance, a significant portion of elementary schoolchildren do not finish Grade 6,
in general, and more so among the poor, in particular. In the case of tertiary education graduates, the passing rates in professional board examinations remain low and
employability is still a major issue. The operating efficiency of state universities and colleges can be substantially improved. In addition, their current record of reaching poorer tertiary education students has been found to be not significantly different from the private higher education institutions. The government has to do a better job in rationalizing the burgeoning number of higher education institutions and encourage those that remain to aim for higher quality. A well-designed and expanded student financial assistance program that gives students the capacity and freedom to choose what course and school to take can improve the efficiency and equity of the tertiary education system.

Know more what PIDS studies have to say about the issues confronting the education sector. Understand the challenges that need to be addressed as the Philippines works to achieve universal primary education by 2015 under the Millennium Development Goals and as it embarks on the Enhanced K to 12 Basic Education Program and reform the higher education system

  1. Economic Policy Monitor 2012: Regional Economic Integration and Inclusive Growth - Engaging Nations, Embracing People

  2. Economic Policy Monitor 2011: Education for Development

  3. Schooling Disparities: An Early Life Lever for Better (or Worse) Equity in the Future

  4. Efficiency of State Universities and Colleges in the Philippines: a Data Envelopment Analysis

  5. Benefit Incidence of Public Spending on Education in the Philippines

  6. Mobilizing LGU Support for Basic Education: Focus on the Special Education Fund

  7. An Assessment of TESDA Scholarship Programs

  8. Promoting Inclusive Growth through the 4Ps

  9. Pantawid Pamilyang Pilipino Program and School Attendance: Early Indications of Success

  10. Enhanced K to 12 Basic Education Program: Opportunities and Challenges

  11. Education, Labor Market and Development: A Review of the Trends and Issues in the Philippines for the Past 25 Years

Questions of sustainability and inclusiveness of economic growth have always been raised in academic and policy debates. In this third issue of the PIDS Economic Policy Monitor (EPM), inclusiveness is examined in the context of regional economic integration. With barely three years remaining before the establishment of the ASEAN Economic Community (AEC), it is but fitting to take a look at the effects of the rapid pace of regional integration on the achievement of sustained, inclusive growth in the Philippines. Despite increasing interrelatedness of markets and freer flows of capital, labor, and technology - which are anticipated to significantly narrow development gaps - income inequalities are rising within countries and between countries in the region. To be truly meaningful, economic growth should be inclusive, where its fruits are not concentrated in the hands of a few but enjoyed by all. It should translate to significant poverty reduction, a better quality of life for the poor.

The four papers featured in this volume show that regional economic integration can become a double-edged sword for the Philippines when its pursuit of full integration into the regional and global economy is not complemented by domestic policy reforms in key economic sectors, the strengthening of industrial capacity, and deepening of poverty reduction efforts. Download the soft copy of the 2012 EPM.

Want more? Know what other PIDS studies have to say about the growth and poverty nexus. What factors constrain inclusive growth? How can the Philippines capitalize on regional economic integration to reduce poverty?

  1. Economic Policy Monitor 2010: Fiscal Space, Investment, and Poverty Alleviation

  2. Regional Integration, Inclusive Growth, and Poverty: Enhancing Employment Opportunities for the Poor

  3. Financing the MDGs and Inclusive Growth in the Time of Fiscal Consolidation

  4. Asia's Underachiever: Deep Constraints in Philippine Economic Growth

For other related studies, visit the SocioEconomic Research Portal for the Philippines.

We bring you our thirty-first volume of the PIDS Development Research News which has an enhanced design and layout. In this first issue for 2013, PIDS President Josef T. Yap has again collaborated with Senior Research Fellow Adoracion M. Navarro in analyzing the country's economic performance in 2012 and its prospects for 2013 amid changing conditions in the regional and global economies. This PIDS tradition of welcoming the new year with an expert's forecast of the economy based on macroeconomic trends and developments of the previous year started in 1998.

Despite the global economic slowdown, the Philippines achieved an impressive full-year growth of 6.6 percent in 2012, the highest growth rate in the ASEAN region. Once again, the Philippines is being hailed as one of Asia's tiger economies, a title we have already heard some 20 years ago but which we eventually lost in subsequent years when we failed to catch up with our Asian neighbors. However, as the authors have pointed out, the lack of inclusiveness of economic growth in the Philippines remains to be a critical issue. Despite gains in previous years, poverty incidence in the Philippines is still relatively high. The phenomenon of jobless growth persists. Click here for the full article.

Interested to read the analyses of the country's economic performance and prospects in previous years? Simply click the links below for issues in the last five years or go to the PIDS publications homepage and click Development Research News on the left panel. Use the drop-down button on the right panel to select the year of your choice.

  1. The Philippine Economy in 2011 and Prospects for 2012

  2. The Philippine Economy in 2010 and Prospects for 2011

  3. The Philippine Economy in 2009 and Prospects for 2010

  4. The Philippine Economy in 2008 and Prospects for 2009

  5. What's in Store for the Philippine Economy in 2008

The clock is ticking for the impending ASEAN Economic Community (AEC) which has a target of 2015. The plan envisions a region fully integrated into the global economy, a highly competitive economic region, and a region of equitable economic development. The areas of cooperation encompass trade and investments facilitation, movement of people, human resource development, financial integration, common mechanism in the political and security fields, and enhanced infrastructure and communications connectivity, to name a few.

What is in store for the Philippines and its neighbouring countries once an ASEAN Community is established by 2015? Should we fear it or should we welcome it? What challenges are confronting the ASEAN countries, particularly the Philippines, to turn this vision into reality. Find out what PIDS studies have to say.

  1. Managing the ASEAN Economic Integration Process in the Philippines: An Assessment of Progress in Trade Liberalization and Facilitation

  2. Achieving the ASEAN Economic Community 2015: Challenges for the Philippines

  3. Closer Trade and Financial Cooperation in ASEAN: Issues at the Regional and National Level with Focus on the Philippines

  4. Investment and Capital Flows: Implications of the ASEAN Economic Community

  5. ASEAN and the Challenge of Closer Economic Integration

  6. Economic Integration and Regional Cooperation in East Asia: A Pragmatic View

  7. Food Security, Agricultural Efficiency and Regional Integration