This document discusses trends and challenges in building infrastructure resilience in the Philippines. It begins with an analytical framework on risk, vulnerability, and resilience. It then examines trends like declining infrastructure spending as a percentage of GDP compared to ASEAN peers. Challenges include the Philippines' high exposure and risk ranking for natural disasters. The case of Super Typhoon Yolanda that caused over $9 billion in damage is discussed. The government response including reconstruction progress and public-private partnership programs is also summarized.
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2 ppi trends & challenges, resilience thru infra v2
1. Trends and Challenges in Building
Resilience through Infrastructure
1
Philippine Institute for Development Studies
Surian sa mga Pag-aaral Pangkaunlaran ng Pilipinas
www.pids.gov.ph
Adoracion M. Navarro
Senior Research Fellow
Pandi, Bulacan
28 April 2016
Philippine Press Institute’s Seminar-Workshop on
Sustainable Construction Reporting
2. OUTLINE
• Suggested Analytical Framework
• Trends in Infrastructure Development
• Challenges in Building Resilience
Case Study: Super Typhoon Yolanda
PPP Program and Status
2
3. Analytical Framework
3
RISK
of a country being
adversely affected by
external shocks
VULNERABILITY/
EXPOSURE
of a country to external
shocks
COPING ABILITY/
RESILIENCE
• Absorptive
• Adaptive
• Transformative
Exposure due
to structural
factors, e.g.
geography
Exposure
due to bad
policies
Good Policy
Interventions
Risk, Vulnerabilities and Resilience
Source: Llanto 2016
• OECD (2014) pointedly explains
that economies with resilient
systems are more capable of
bearing various environmental,
political, economic, and social
risks, stresses, and shocks.
• Llanto (2016) stresses that risks
are not only limited to
disasters, but also economic
shocks due to global
interconnectedness
• Good economic policies have a large
role to play in building the economy’s
resilience
• Building resilient infra is also key
4. Trends in Infrastructure Development
• Infrastructure spending was at
2.38% in 2015
• Further, actual expenditures in 2014
showed that the public infrastructure
spending-to-GDP ratio declined to 1.26
percent from 1.98 percent in 2013
• Low disbursements may be
attributed to:
• delays due to additional procedures;
• additional restrictions on the use of
savings and realignments (i.e. SC
ruling on DAP);
• structural weaknesses within the
agencies; and
• other reasons that are beyond the
control of the agencies. (DBM, 2014)
4
1.79%
2.09%
1.74%
1.41%
1.73%
1.98%
1.26%
2.38%
2.34%
2.75%
2.15%
1.88%
2.83% 2.81%
1.79%
3.79%
2008 2009 2010 2011 2012 2013 2014 2015
Infrastructure Outlay, % of GDP Capital Outlays, % of GDP
Actual Infrastructure and Other Capital Outlays as % of GDP,
2008-2014
Source: Department of Budget and Management
Notes: 2008 to 2014 figures – actual spending; 2015 figures – adjusted obligations.
5. Trends in Infrastructure Development
• Competitive Bidding as the default
mode of procurement according to
RA 9184.
• Allowable time until issuance of
notice to proceed:
• For below P50 M: 113 calendar days
• For P50 M and above: 144 calendar days
• However, there are delays in
procurement. GPPB-TSO highlights
that the most common cause of
delays can be traced to the planning
stage; also causes failure of bidding.
• Difficulty in setting appropriate ABC
• Lapses in details of technical specs
5
Pre-Procurement
Conference
Award of
Contract
Advertisement Pre-Bid Conference
Bid Evaluation &
Ranking
Post-Qualification
Submission of
Bids
Opening of 2nd
Envelope –
Financial Proposal
Opening of 1st
Envelope –
Eligibility Docs &
Technical Proposal
Standardized Bidding Procedure for Goods and Infra
Source: Capacity Development Division, GPPB
6. Trends in Infrastructure Development
6
BRN, 27.3
IND, 32.6
CMB, 20.9
LAO, 30.1
MYS, 26.0
PHL, 20.8
SGP, 25.4
THA, 24.6
VNM, 23.8
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Gross Capital Formation (as % of GDP): 2000 - 2014
Source: Worldbank Database
• Among ASEAN member
states, the Philippines
ranks 2nd to the last in
terms of gross capital
formation (% of GDP) in
2015.
7. Challenges in Building Resilience
Country Risk (%) Rank
Vanuatu 36.5 1
Philippines 28.25 2
Tonga 28.23 3
Guatemala 20.68 4
Bangladesh 19.37 5
Solomon Islands 19.18 6
Costa Rica 17.33 7
El Salvador 17.12 8
Cambodia 17.12 9
Papua New Guinea 16.74 10
Timor-Leste 16.41 11
Brunei Darussalam 16.23 12
Nicaragua 14.87 13
Mauritius 14.78 14
Guinea-Bissau 13.75 15
7
Country Exposure (%) Rank
Vanuatu 63.66 1
Tonga 55.27 2
Philippines 52.46 3
Japan 45.91 4
Costa Rica 42.61 5
Brunei Darussalam 41.1 6
Mauritius 37.35 7
Guatemala 36.3 8
El Salvador 32.6 9
Bangladesh 31.7 10
Chile 30.95 11
Netherlands 30.57 12
Solomon Islands 29.98 13
Fiji 27.71 14
Cambodia 27.65 15
Top 15 countries most at risk worldwide,
World Risk Report 2014
Top 15 countries most exposed worldwide,
World Risk Report 2014
Source: UNU-EHS and Alliance Development Works (2014)
population,
conditions
of builtup
areas, infra,
environmen
tal areas
8. • From 2000-2014, an
average of 19 tropical
cyclones per year hit the
Philippines.
• Almost 8 were typhoons,
while the remaining were
classified as either tropical
storms or tropical
depression.
• In 2013, we had the most
number of cyclones.
• including one super
typhoon (Yolanda)
8
18
17
13
25 25
17
20
13
21
22
11
19
17
25
15
0
5
10
15
20
25
30
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Tropical Depression Tropical Storm Typhoon Super Typhoon
Total No. of Cyclones, per Category, in the Philippines: 2000-2014
Source: Reyes, C. (2016)
Challenges in Building Resilience
9. • Tropical depression - a tropical cyclone with maximum sustained winds of
up to 61 kilometers per hour (kph) or less than 33 nautical miles per hour
(knots)
• Tropical storm - a tropical cyclone with maximum wind speed of 62 to 88
kph or 34 - 47 knots
• Severe tropical storm - a tropical cyclone with maximum wind speed of 89
to 117 kph or 48 - 63 knots
• Typhoon - a tropical cyclone with maximum wind speed of 118 to 220 kph
or 64 - 120 knots
• Super typhoon - a tropical cyclone with maximum wind speed exceeding
220 kph or more than 120 knots.
9
10. 10
Storms,
51.3
Flood, 31.9
Landslide,
6.4
Volcano,
4.6
Earthquake
, 4.1
Other, 1.7
Frequency
Storm, 78.7
Earthquake
, 7.9
Flood, 5.9
Landslide,
5.6
Other, 2.0
Mortality
Storm, 79.0
Flood, 17.3
Earthquake
, 2.2
Other, 1.5
Economic
Impacts
Frequency and Impacts of Disasters in the Philippines, 1990-2014
Source: The OFDA/CRED - International Disaster Database
• Cyclones/storms are the most frequent disaster in the county, which account for the
highest mortalities and the most adverse economic impacts.
Challenges in Building Resilience
11. Case of Super Typhoon Yolanda
• Super Typhoon Yolanda
• 8 November 2013
• Affected Regions VI-B, VI, VII, and
VIII
• Casualties
• 6,300 deaths, 28,688 injured,
1,062 missing
• Total Damaged houses: 1,140,332
• 550,928 totally
• 589,404 partially
• Total Infrastructure damage is
9.584B
11
Track of Super Typhoon Yolanda
Source:http://goo.gl/jHtM9a
12. Case of Super Typhoon Yolanda
• The Comprehensive Rehabilitation
and Recovery Plan requires a total
amount of P167,864,788,553 from
2014 to 2016.
• Resettlement comprise 46% of the total
budget needed, while infrastructure is
21% of the total budget.
12
Source: Official Gazette
Typhoon Yolanda Funding Requirements, 2014-2016
• As of October 21, 2014, out of the total funding requirement, the DBM reports
that the amount of P51,981,511,885 has already been released to fund the
typhoon relief, rehabilitation and recovery efforts.
Cluster Amount
Infrastructure 35,148,634,408
Social Services 26,406,233,815
Resettlement 75,678,683,100
Livelihood 30,631,237,230
Total 167,864,788,553
13. Government Response: Infrastructure Cluster
13
Agency Project
Total Physical
Target
Completed On Going
Pre-Procurement/
Procurement Stage
DPWH
National Roads (in km) 106.7 60.286 38.415 7.346
Bridges (in km) 1852.53 1117.64 640.09 94.8
Access Roads (in km) 1.7 1.7 - -
Flood Control (no. of projects) 110 77 17 8
DPWH Buildings (no. of buildings) 48 36 11 1
Reconstruction of Municipal Facilities (no. of
buildings)
25 2 14 9
DepEd
New Construction (no. of projects) 2,313 1,026 928 359
Rehabilitation (no. of projects) 17,335 5,457 4,239 3484
School Furniture (no. of furnitures) 292,166 121,950 0 170,216
DILG
Repair/rehabilitation
of partially-damaged LGU Facilities (no. of projects)
309 292 no data no data
CHED SUCs (no. of projects) 606 412 191 3
Source: DPWH, 2015
Summary of Accomplishments, as of September 15, 2015
14. Government Response:
Resettlement Cluster
Summary of Accomplishments, as of 5
November 2015
• NHA
• Completed: 17,641 permanent housing units
• Currently on-going: 42,566 permanent housing units
• With funding: 74,385 permanent housing units
• Target completion is December 2016
• DSWD
• 92,554 housing constructions funded
• 987,545 out of 1,028,329 families with damaged
houses were given Emergency Shelter Assistance (ESA)
• On going: 40,784 families with damaged houses are
covered and will be given Emergency Shelter Assistance
(ESA)
14
Source: NHA, 2015
Note: This is a photo of Brgy. San Isidro, Tacloban City
Source: NHA, 2015
Note: This is a photo of Brgy. Sacme, Tanuan, Leyte.
15. The challenge of sustaining the PPP Program
• Public-Private Partnership
• As of 11 January 2016, there
are 12 awarded PPP projects,
for a total of Php 217.4 billion
• Three (3) completed projects:
• Muntinlupa-Cavite Expressway
• Automated Fare Collection system
• PPP for School Infrastructure – Phase 1
• Two (2) more expected to be
completed before end of
Aquino administration:
• NAIA Expressway – Phase 2
• PPP for School Infrastructure – Phase 2
15
No. Project
Amount
(in Billion Php)
1 Daang Hari-SLEX Link Road 2.01
2 PPP School Infrastructure Phase 1 16.43
3 NAIA Expressway (Phase II) Project 15.86
4 PPP for School Infrastructure Phase 2 3.86
5
Modernization of Philippine Orthopedic
Center
8.69
6 Automatic Fare Collection System (AFCS) 1.72
7
Mactan-Cebu International Airport Passenger
Terminal Building
17.52
8 LRT Line 1 Cavite Extension and O&M 64.90
9
Southwest Integrated Transport System (ITS)
Project
2.50
10 Cavite-Laguna (CALA) Expressway 55.51
11 South Integrated Transport System Project 4.00
12 Bulcan Bulk Water Supply Project 24.40
Source:PPPCenter
Awarded PPP Projects, as of 2016
16. Status of Some PPP Projects
16
Project Status
1. NAIA Expressway (Phase II) Project
Expected to be completed in 2016; Construction ongoing:
72.69% complete (as of 18 March 2016)
2. PPP for School Infrastructure Phase 2
Expected to be completed in 2016;
As of 29 February 2016:
2,035 classrooms (46.57%) completed;
1,295 classrooms (29.63%) with ongoing construction;
and
1,042 classrooms (23.84%) under pre-construction
phases.
3. Modernization of Philippine Orthopedic
Center
Megawide letter requesting termination of concession
agreement received by DOH on 10 November 2015.
DOH letter of March 3, 2016 confirmed DOH acceptance of
Megawide's request for termination
4. Mactan-Cebu International Airport Passenger
Terminal Building
As of 29 February 2016:
Construction ongoing: 12.48% completed
Source:PPPCenter
17. 17
Project Status
5. LRT Line 1 Cavite Extension
and O&M
Financial Closure achieved on 11 February 2016; and
Ongoing soft renovation and upgrades of LRT Line 1 existing system and other
pre-construction activities.
6. Southwest Integrated
Transport System (ITS) Project
Concession Agreement signed on 24 April 2015; and
Ongoing pre-construction activities and procurement of independent
consultant (IC).
7. Cavite-Laguna (CALA)
Expressway
Contract signed on 10 July 2015; and
Ongoing pre-construction activities and procurement of independent
consultant (IC).
8. South Integrated Transport
System Project
Contract signed on 26 January 2016;
Ongoing Independent Consultant procurement and pre-construction
activities.
9. Bulcan Bulk Water Supply
Project
Groundbreaking ceremony held on April 15, 2016; and
Ongoing pre-construction activities.
Status of Some PPP Projects
Source: PPP Center
Figure above is a modification of Briguglio et al. Llanto explains:
“Absorptive, adaptive, and transformative” are inserted in the box of “coping ability”. “Exposure to bad policies” is also included as a factor behind the vulnerability of an economy to external shocks. In Briguglio et al.’s original Figure 2, only the “inherent and permanent” features of an economy listed as “economic openness, export concentration, and dependence on strategic imports” are the determinants of vulnerability or exposure of an economy to exogenous shocks. Briguglio et al. (2008) state that these features are not subject to policy or governance. Structural factors like geography influence the vulnerability of an economy. The author of this paper, however, believes that bad policies also determine the vulnerability of an economy to exogenous shocks. Economic openness, export concentration, and dependence on strategic imports may also be determined by the policies a country adopts.
Important Note: Some reports use the capital outlay-to-GDP ratio accomplishment when comparing with the 5-percent-of-GDP target. But capital outlays are "an expenditure category/expense class for the purchase of goods and services, the benefits of which extend beyond the fiscal year and which add to the assets of the government, including investments in the capital stock of GOCCs and their subsidiaries" (DBM 2015, p. 704) and, therefore, consist of more items than infrastructure spending.
Low disbursement explanations:
-delays introduced by additional transparency and accountability procedures;
-additional restrictions on the use of savings and realignments when the SC ruled the unconstitutionality of the Disbursement Acceleration Program;
-structural weaknesses within the agencies (namely, poor project preparation, project implementation difficulties, and procurement issues); and
-other reasons that are beyond the control of the agencies (e.g., unfavorable weather and adverse peace and order situation).
ABC – approved budget for the contract
Gross fixed capital formation (formerly gross domestic fixed investment) includes land improvements (fences, ditches, drains, and so on); plant, machinery, and equipment purchases; and the construction of roads, railways, and the like, including schools, offices, hospitals, private residential dwellings, and commercial and industrial buildings. According to the 1993 SNA, net acquisitions of valuables are also considered capital formation.
Exposure is defined in the World Risk Report 2014 as entities (i.e., population, conditions of builtup areas, infrastructure component, environmental area) that are being exposed to the impacts of one or more natural hazards (i.e., earthquakes, cyclones, droughts, floods, and sea-level rise).
Risk is the “interaction between exposure to natural hazards including the adverse effects of climate change and the vulnerability of societies” arising from their geographical location (UNU-EHS and Alliance Development Works, p. 42).
See: http://www.preventionweb.net/countries/phl/data/
For a disaster to be entered into the database at least one of the following criteria must be fulfilled:
Ten (10) or more people reported killed.
Hundred (100) or more people reported affected.
Declaration of a state of emergency.
Call for international assistance.
Source of Statistics: NDRMMC Final Report
See: http://www.ndrrmc.gov.ph/attachments/article/1329/FINAL_REPORT_re_Effects_of_Typhoon_YOLANDA_(HAIYAN)_06-09NOV2013.pdf
Source: http://www.dbm.gov.ph/wp-content/uploads/YOLANDA/List%20of%20Releases%20(excel%20file)/DPWH.pdf
Note: Yellow shows 100% completion
green are projects with over 50% completion.
No color means did not accomplish at least 50%
Not included in the Infra cluster report but DOTC has the following accomplishments:
- 23 rehabilitated seaports
- 35 out of 37 rehabilitated airports
- 5 repaired structures/building
DepEd data really shows discrepancy when it comes to Rehabilitation. Number does not add up.
For PSIP Phase 1 -- 9,296 classrooms (100%) completed and delivered
Exec. Director Canilao is to step down from her post effective March 8, 2016.
Aquino has awarded 12 of 37 PPP projects in the pipeline.
See: http://cnnphilippines.com/business/2016/02/11/Aquino-PPP-projects.html
On the other hand, 14 PPP projects worth P556.56 billion are under procurement.
See: http://www.mb.com.ph/status-report-on-p1-623-trillion-ppp-projects-revealed/#hbZvICSES1uh6plt.99
Note that you’ll get the public support, e.g., post about a heckler accusing Rappler of media bias