By Aubrey Rose A. innocente, reporter
Tapping Private and Development PartNERS can help improve EF for state infrastructure projectsFThe Philippine government continues to respond with promptness and transparency to the economic fallout from public works corruption scandals.
Riza Blanco-Latorre, Executive Director and Undersecretary of the Public-Private Partnership (PPP) Center, who took chargeFOn December 11, Ice said that infrastructure projects could be partnered with private entities. Be a “viable” alternative to the government.
“The (PPP) option enables the public to access private sector expertise while ensuring that project delivery is performance-based, has optimal risk allocation, and holds private partners accountable throughout the project lifecycle,” he explained. businessworld In a Viber message on December 19.
The Marcos administration is facing governance concerns in the form of a wide-scale dispute involving disproportionate state flood control and public works infrastructure projects.FOfficials, lawmakers and contractors have highlighted systemic corruption that is hampering the delivery of public services while impacting the Philippines' economic prospects.
In the third quarter of 2025, Philippine gross domestic product (GDP) growth slowed to a four-year low of more than 4% as a corruption scandal restrained both public and consumer spending.
Analysts have said that reducing the government's monopoly on infrastructure projects could be the key to curbing corruption.
Under the PPP model, the government can give subsidies, tax breaks, guaranteed revenues or asset transfers to attract private sector partners to help finance, construct and operate projects.
“The PPP Center has established relevant project development and project management interventions, as well as capacity building support, to enable relevant implementing agencies to pursue the said PPP option,” Ms. Blanco-Latorre said.
The PPP Code enables projects typically funded by the national budget to be carried out through the model and also allows both solicited and unsolicited proposals.
A solicited proposal refers to projects that are identified by the implementing agency from their list of priority projects for which bids are invited from the public, while an unsolicited proposal is submitted by private sector proponents without formal solicitation from the government.
“However, we reiterate the critical need to diligently structure these projects as PPPs to ensure the feasibility of private sector participation, manage implementation risks and truly secure the best deal for the government and the public,” he said.
Data from the PPP Center as of December 19 showed that the project pipeline included 251 projects worth P2.81 trillion, while 290 projects Works worth P3.61 trillion are under implementation.
Acting Budget Secretary Rolando U. While both private and development partners can help the government address infrastructure deficiencies, public spending is now coming under greater scrutiny, Toledo said.
“Strategic use of PPP and concessional financing can help restore credibility and accelerate delivery given the additional layer of review being conducted here by oversight agencies,” he said in a statement sent by the government. businessworld Via Viber message on December 20.
He said proposed projects are reviewed through inter-agency discussions to assess their feasibility, while ongoing projects are regularly monitored for performance.
“Given the decline in public infrastructure spending due to flood control issues, it is important that private construction steps in to cover the shortfalls we face in infrastructure development.”
Mr. Toledo said PPP has “huge potential” as private sector interest in undertaking projects has increased since the passage of the PPP Code. However, this also increases the need for strong preparation, transparency and accountability mechanisms at all stages of project delivery.
governance risk
Infrastructure investment is a “significant” contributor to GDP because it directly contributesand has a multiplier effect This could boost economic growth, said Andrew Jeff, Philippines country director of the Asian Development Bank (ADB).FRees said in an e-mailed statement Dec. 18.
“There remains a need for large-scale public investment to address critical infrastructure gaps to strengthen the competitiveness of the Philippines as a destination for private investment – particularly in transportation, energy and digital connectivity,” he said.
“The biggest risk with a sustained reduction in public expenditure is that if critical investment needs are not met, the country's overall competitiveness and productivity decline. Regardless of the source of funding, execution and governance risks need to be managed to ensure the quality of infrastructure spending.”
Mr Jefferies said the government should prioritize investment in social infrastructure where commercial returns are not attractive for private sector players.
“Private sector investment can increase efficiency and help effective technology transfer. Multilateral development bank financing can be a source of long-term stable financing and best practices, and can help deliver strong governance,” he said. “As the Philippines moves closer to upper middle income country status, the private sector will need to play an increasingly important role in promoting innovation, job creation and growth.”
Mr. Jeffries said ADB stands ready to support Philippine infrastructure development through both financing and policy support.
“This support includes strong monitoring of procurement, financial management and project implementation, as well as the ability to provide large-scale financing. However, ADB's support goes far beyond infrastructure project loans, and includes policy support and technical assistance to improve regulatory frameworks and ease of doing business,” he said.
Improving the enabling environment for private investment and PPPs is also part of ADB's key support areas for the Philippines, he said.
“At the same time, recent issues also underline that PPPs are not a substitute for strong public sector planning, governance and oversight. In practice, the feasibility of an expanded PPP role will depend on continued improvements in upstream project preparation, transparent and competitive procurement and credible regulatory frameworks.”
“Without these foundations, handing over more responsibility to private companies could shift project risks and costs rather than reduce them.”
Nigel Paul C. Villarete, a senior consultant on PPPs at technical advisory group Libra Consult Inc., said it is necessary for a developing economy like the Philippines, whose spending needs far exceed its ability to generate revenue, opening the door to increased private sector participation in infrastructure projects while putting in place appropriate safeguards.
“Although we have a large and growing share of private sector investment, our annual development expenditure is still mostly public. But the potential to boost private investment in nation-building is available and necessary,” he said in a Viber message on December 20. “We are not prioritizing or changing one over the other – we are simply using the financing opportunities available to support core public fiscal spending, which should continue as the main source.”
However, the government must rebuild investor confidence by implementing reforms, he said.
“As always, investor confidence is important. No one will spend money when uncertainties remain, especially when these include potential corruption issues. That is why clear and fair rules and guidelines are essential.” [with] Ambiguities were minimized or eliminated altogether,” Mr. Villarete said.
“We also need to understand that private sector financing will only be attractive if the private sector is allowed to generate attractive rates of return. This is where the balance comes in. PPPs must be both attractive and safe for all sectors.”
Mr. Toledo also acknowledged that improving investor sentiment is important to ensure the economy's recovery amid the corruption scandal.
“The main risk is if investor confidence remains low and hence, it will not provide the required boost to GDP growth,” he said.
“In the short term, growth outcomes will still depend on the government's ability to generate confidence through its efficient spending and credible policies in addressing corruption.”