The Philippine government has a repetitive narrative when it comes to infrastructure \u2013 that it will \u201crevitalize<\/a> the economy\u201d and \u201ccreate<\/a> more jobs\u201d or that the government is \u201cBuilding<\/a> more for better lives\u201d. These claims about infrastructure projects have been repeated for so long that they seem like obvious benefits, but history shows that this is not always the case.<\/p>\n\n\n\n Expensive<\/strong><\/p>\n\n\n\n With infrastructure side by side with debt servicing and military modernization as its budget priorities, the government looks outward to finance its projects. Out of the 194 IFPs, 79 are funded by official development assistance (ODA), 45 by public-private partnerships (PPPs), 66 through the national budget or the General Appropriations Act (GAA), and two by hybrid PPPs. Only the funding sources of two other projects have yet to be determined.<\/p>\n\n\n\n ODA funding can be in the form of loans below commercial rates or outright grants. Such money is supposedly used to achieve development targets. In 2021 alone, the Philippines had US$30.2 billion<\/a> in loan commitments. This included 107 loans distributed across different implementing agencies, 44 of which are for Department of Transportation (DOTr and Department of Public Works and Highways (DPWH) with a total value of Php13.1 billion (40.5% of the total ODA profile). <\/p>\n\n\n\n Borrowing money to support development efforts is not wrong but it\u2019s important to note that foreign lenders give ODA most of all as part of their countries\u2019 foreign policy objectives and perceived self-interest rather than out of any altruism. For instance, Japan has long been the country\u2019s biggest ODA provider, and the overwhelming bulk from it has gone to infrastructure to support Japanese investment in the country if not outright spent on Japanese firms and contractors. <\/p>\n\n\n\n Also, among the ways lenders benefit from ODA is giving this as \u201ctied aid\u201d which restricts the loan\u2019s usage to buying equipment or spending on technical assistance from the donor country. <\/p>\n\n\n\n Kaliwa Dam<\/a>, meanwhile, got a US$283.2 million China loan for its construction. China Energy Engineering Corporation Limited was selected as contractor<\/a> for the project.<\/p>\n\n\n\n Borrowing and privatizing and borrowing to support privatizing has become a spiral ingrained in the budget process. ODA as well as development financing from multilateral institutions such as the World Bank, International Monetary Fund (IMF) and the Asian Development Bank (ADB) and from bilateral sources are oftentimes onerous loans that do not really result in broad-based development.<\/p>\n\n\n\n For instance, the country is currently paying relatively higher interest rates on Chinese loan commitments for projects under the Duterte administration which have carried over in Marcos Jr\u2019s list of IFPs, such as the New Centennial Water Source (NCWS) – Kaliwa Dam project and the PNR South Long Haul. In 2019, the country received a US$430.99 million<\/a> loan from China for the above-mentioned projects, paying<\/a> a 2% interest rate for a tied concessional loan and 3% interest rate for a tied preferential buyer\u2019s credit loan, which will both last for 20 years with a 5-year grace period \u2013 a stark contrast to interest rates offered by Japan\u2019s Special Term for Economic Partnership (STEP) loans (0.1%) and France\u2019s soft loans (0.4%), among other loan sources. Historically, Chinese loans are more expensive<\/a> than World Bank loans by 0.15 percentage points.<\/p>\n\n\n\n Meanwhile, PPPs are agreements between the public and private sector regarding the construction and operation of infrastructure that has traditionally been taken on by the public sector. Since the private sector is involved, projects become overly motivated by profit-generation which is the only thing that would incentivize them. Utilities and services with inelastic demand are put under the monopoly of the private sector, which will gouge the consumers with high prices to the extent of demand.<\/p>\n\n\n\n Unsolicited PPPs tend to primarily benefit the comprador economy. D.M. Consunji, Inc., for instance, was awarded the construction contract<\/a> for the Php39-billion NLEX-SLEX Connector Road in 2019. On top of that, in the same year, San Miguel Corporation (SMC) expressed interest to construct and operate a bus terminal<\/a> along the connector. Under the BBM, there are three other IFPs funded by unsolicited PPPs: the MRT-7 Project, New Manila International Airport in Bulacan, and Davao Sasa Port.<\/p>\n\n\n\n The NLEX-SLEX Connector is not the only IFP that SMC will benefit from. Some projects they were awarded the contract for include MRT-7<\/a>, which costs Php77-billion to construct, and the controversial Php754-billion New Manila International Airport<\/a> (NMIA) in Bulacan. SMC also owns SLEX, which plans on constructing a 66.74 km toll road from Batangas and Quezon; and a 417 km toll road from Quezon to Sorsogon.<\/p>\n\n\n\n Lastly, the Davao Sasa Port was originally proposed by Dennis Uy firm Chelsea Logistics and Infrastructure Holdings Corp., who lost Php2.53 billion<\/a> in 2022. Now, Globalport 900 Inc.<\/a> is eyeing the project\u2019s management, operations, and maintenance. According to a disclosure form<\/a> from the Philippine Stock Exchange (PSE), Globalport 900 is currently headed by Sheila Romero<\/a>, wife of ex-deputy speaker Mikee Romero who was once the richest<\/a> lawmaker in the House of Representatives.<\/p>\n\n\n\n Harmful<\/strong><\/p>\n\n\n\n For large projects such as Kaliwa Dam, ecological damages are on a grand scale. The mega dam project threatens biodiversity with the forests and coastline of the project containing nearly 3,000 species<\/a> of amphibians, birds, fishes, invertebrates, mammals, plants and reptiles. This includes three (3) critically endangered, 31 endangered, and 240 vulnerable species put at risk by the project, according to data from Haribon Foundation. Some 16,000 trees<\/a> will also be affected by the mega dam\u2019s construction, more than half of which are coconut trees while the rest are fruit bearing trees. Coconut trees are a big source of livelihood for farmers in Quezon.<\/p>\n\n\n\n Thousands of individuals are also being compelled to evacuate as a result of various government infrastructure projects. For example, the construction of the Kaliwa Dam is set to displace approximately 1,400 Agta-Dumagat-Remontado families from Quezon and Rizal, as reported by Katribu. Furthermore, the construction of the Php735 billion NMIA in SMC’s Bulacan Aerotropolis, which involves a highly detrimental reclamation project, poses a threat to around 700 fisherfolk families in Bulacan<\/a>, jeopardizing their livelihoods. It is worth noting that the reclamation project has already resulted in the destruction of around 6,000 mangrove trees<\/a>.<\/p>\n\n\n\n The significance of mangrove trees extends beyond their role in coastline protection. They also function as vital carbon sinks, capable of storing up to five times more carbon than tropical upland forests<\/a>. The destruction of mangroves, as witnessed in the reclamation project mentioned earlier, contributes to the release of stored carbon dioxide, thereby exacerbating climate change. This loss not only compromises the natural coastal defenses provided by mangroves but also has wider implications for the global carbon balance.<\/p>\n\n\n\n Billions poured, millions poor<\/strong><\/p>\n\n\n\n
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