Medium- Term Philippine si aoa Plan 1999-2004Philippine Copyright @ 1999 by the National Economic and Development Authority ISSN 0119-3880 Printed in the Philippines September 1999TABLE OF CONTENTS Foreword — Acknowledgement Memorandum Circular No. 7 List of Tables List of Figures: List of Acronyms - Glossary of Terms Chapter 1 DEVELOPMENT CHALLENGES Challenges Vision: Sustainable Development and Growth with Social Equity Mission Guiding Principles ~ Chapter2__ SOCIAL REFORM AND DEVELOPMENT. Assessment of Performance-- Challenges ~~ Development Goals and Objectives ~ Policies and Strategies Targets ~ Priority Sector Activities Priority Legislative Agenda Chapter3 AGRICULTURE, AGRARIAN REFORM AND NATURAL RESOURCES ‘Assessment of Performance Development Goals and Objectives Policies and Strategies ‘Targets - Priority Sector Activities — Priority Legislative Agenda Chapter4_ INDUSTRY AND SERVICES -. Assessment of Performance: Development Goals and Objectives Policies and Strategies ‘Targets - Priority Sector Activities — Priority Legislative Agenda-- Chapter5 INFRASTRUCTURE DEVELOPMENT “Assessment of Performance: Development Objectives Policies and Strategies ~Chapter 6 GOVERNANCE AND INSTITUTIONS DEVELOPMENT: ‘Assessment of Performance ~ Challenges - Development Goals and Objectives Policies and Strategies ~ Quantitative Target Priority Subsector Activities. Priority Legislative Agenda ~ Chapter 7 MACROECONOMIC FRAMEWORK AND DEVELOPMENT FINANCING “Assessment of Performance ~ Challenges Development Objectives - Policies and Strategies ~ Targets ~ Priority Subsector Activities Priority Legislative AgendaMALACANAN PALACE MANILA pene FOREWORD Towards the close of the twentieth century, the challenge for the Philippines remains in significantly improving the lives of its people. The progress of the past few years has not raised the standard of living of the majority of Filipinos to decent levels. Against this backdrop, I ran for the presidency of our country in 1998. I campaigned on a platform of growth with equity. These twin objectives were based on the realization that growth is a precondition to reducing poverty and raising the standard of living. On the other hand, the fruits of such growth should be equitably shared. Indeed, widespread poverty results in small markets, environmental degradation and social unrest, and these inhibit sustainable development and economic ‘growth in the long run, ‘Thus, I outlined a program that is both propoor and pro-market. The program is propoor because the poor are the ultimate targets of our programs. We want the poor to share in the benefits of growth and the vulnerable to be protected through the difficulties of the growth process. But ‘more importantly, we want to empower the poor so that they can fully participate in our nation’s life. Strong emph: has to be placed on basic social programs for education and training, health and nutrition, housing, social welfare, social security, and safety nets. (Our program is at the same time pro-market. We need to be pro-market if we are to reap the benefits of globalization. We have achieved in our time such a high degree of economic interdependence on a global basis. Our environment is such that, because of advances in technology, “developments on the other side of the world have instantaneous effects on our financial marketsMeanwhile, the economic health - or lack of it - of our neighbors affects our own growth and ‘capacity to create jobs through our trade ties with them. In this environment, the only way to survive is to be competitive. Competitiveness flourishes when policies foster efficient private sector participation and when the macroeconomic environment is sound. Soon after I assumed the Presidency, I directed the National Economic and Development Authority to coordinate the preparation of a medium-term plan that will bring to reality this vision. Tam happy and proud that after nine months of broad - based planning and consultations involving, all sectors of our society and consulting all regions of our country, we have a Plan that reflects our aspirations. ‘The Plan, called the Medium-Term Philippine Development Plan, 1999-2004, has six sectoral chapters pertaining to the six priority areas of my administration: (1) delivering basic social development services; (2) accelerating rural development; (3) accelerating infrastructure development; (4) enhancing global competitiveness; (5) ensuring macroeconomic stability; and (6) reforming governance. Together, these six chapters spell out a coordinated approach for sustaining growth and reducing poverty. At the end of the Plan period in 2004, which coincides with the close of my termat the Presidency, we are targeting a drop in the poverty incidence to 25-28 percent from 32 percent in 1997. ‘The Plan also sets out the framework of governance that shalll underlie our development efforts. ‘As demonstrated by the Asian crisis, transparency and accountability are of paramount importance. ‘Though we shall remain committed to liberalization, deregulation and privatization, our regulatory and supervisory frameworks shall be subject to consultation and public disclosure, with the government accountable to the people at every stage. ‘The role of the private sector including nongovernmental and people's organizations, as well as local governments, in our development efforts cannot be overemphasized. The Plan is explicit on the roles and responsibilities expected of these partners in development. The underlying principle is one where the national government provides the enabling environment and assists in building capability to enable the economic actors to function efficiently and productively. The objective is to foster strength and self-reliance. This is what we will pursue, as individual entities and as a nation. Inclosing, exhort everyone to help in turning our vision into reality through the implementation of this Plan. Walang tutulong sa Pilipino kung hindi ang kapwa Pilipino! oon eZ JOSEPH EJERCITO ESTRADA.ACKNOWLEDGEMENT The Medium-Term Philippine Development Plan, 1999-2004 embodies not just the vision and policy thrusts of the Estrada administration but of the Filipino people. The drafting of the Plan involved a highly consultative process. In all the committees that were formed, the major stakeholders -- civil society, the business sector and government including the legislature — were adequately represented. Members of the legislature and the private sector served as Co-Chairs in the committees. The draft Plan also benefitted from the insights of about 2,500 participants in 16 regional consultations. These efforts were exerted to ensure broad geographic and sectoral ownership of the Plan. The Plan spells out what we as a nation aspire for over the medium-term, foremost of which are the improvement in income distribution and reduction in poverty in an environment of sustained growth. However, the decision-making and resource allocation that will bring us to this envisioned state will, in most cases, involve both gainers and losers. The Plan therefore clarifies what some of us will have to give up for the greater good. For instance, government will have to cease its ineffective spending for programs having the least benefit for the rural poor. Those in the private sector who flourished in the past because of special favors from government in various forms will also have to adjust and restructure, Beyond the formulation of the Plan lies the more difficult task of ensuring its successful implementation. Here we ask the broadest support from everyone. Indeed, the successful implementation of the Plan lies in the strong partnership and equitable risk- and gain-sharing among government, the business community, and civil society. The completion of the Plan document gives us the pleasure of thanking everyone involved in the planning process. We thank the secretariats and members of the sectoral Planning ‘Committees, the Technical Coordinating Committee and the Plan Steering Committee who devoted valuable time and expertise to this process. We also thank all representatives in the 16 regional consultations including those from the Regional Development Councils. For those of us who participated in these consultations and meetings, the discussions were an education in the diversity of development issues facing various sectors of our society. It is our hope that the enthusiasm and ‘support that attended the preparation of the Plan will be sustained as we implement the major policy reforms embodied in the Plan. SECRETARY FELIPE M. MEDALLA Chair, Plan Steering Committee DEPUTY SPEAKER DAI: /ANCE-FUENTES Co-Chair, Plan Steering \ittee MR. VICENTE LIM ; "0-Chair, Plan Steering Committee r, Plan Steering CommitteeMALACANANG MANILA MEMORANDUM CIRCULAR NO. 7 DIRECTING THE FORMULATION OF THE MEDIUM-TERM PHILIPPINE DEVELOPMENT PLAN, 1999-2004 WHEREAS, Article XII, Section 9 of the 1987 Constitution mandates the economic and development planning agency of the government to implement continuing integrated and coordinated programs and policies for national development after consultations with the appropriate public agencies, various private sectors, and local government units; WHEREAS, the vision of the Estrada Administration calls for poverty reduction through sustained growth and effective targeted support programs for the poor and vulnerable sectors of societ WHEREAS, there is a need to translate the vision of the Estrada Administration into specific policies, programs, and targets, as well as define the enabling legislation that will support such undertaking; WHEREAS, in line with the objective of government to rationalize government spending and ensure effective governance, the development plan to be formulated shall be the basis of the three-year expenditure framework, which specifies the resource allocation of the national government, as well as the sectoral plans of the various agencies; WHEREAS, there is a need to ensure that the development plan to be formulated reflect the aspirations of all sectors of the Philippine society, including the marginalized sectors and communities, the private sector, civil society, and the government; NOW, THEREFORE, I, JOSEPH EJERCITO ESTRADA, President of the Republic of the Philippines, by virtue of the powers vested in me by law, do hereby order that: SECTION 1. Lead Coordinator. The National Economic and Development Authority (NEDA) shall coordinate the preparation of the Medium-Term Philippine Development Plan, 1999-2004, which shall focus on attaining the vision of a more prosperous, equitable, and peaceful society through sustained growth, efficient and targeted programs to support the poor and vulnerable sectors of society, and effective governance, particularly the pursuit of peace and order. As the Lead Coordinator, the NEDA is hereby authorized to create the appropriate committees, as may be necessary, to ensure the efficient discharge of its functions.SECTION 2. Components of the Plan. The Plan shall contain at least the following basic elements: a. Development goals and objectives; b. Strategy and policy framework to attain the goals and objectives; and c. Priority sectoral activities including programs and projects, measurable targets, and the legislative agenda supportive of the development objectives. SECTION 3. Consultations with Concerned Agencies and Sectors. The Plan shall be formulated in close collaboration and consultation with other agencies of the executive branch, the legislative branch, the local government units, and the private/non-government sectors. All departments, agencies and government-owned and/or -controlled corporations shall participate in the formulation of the Plan through the planning committees that will be organized, or through the consultation process. For this purpose, they shall draw inputs from their regional offices, which in turn shall consider regional development goals and strategies, as well as the physical framework for the regions and local needs. SECTION 4. Planning Guidelines. The process to be followed in the formulation of the Plan shall be in accordance with the planning guidelines to be prepared by the NEDA Secretariat. SECTION 5. Funding. The Department of Budget and Management shall provide the funds necessary for the attainment of the objective of this Circular, subject to the usual accounting and auditing requirements. SECTION 6. Effectivity. This Circular shall take effect immediately. DONE in the City of Manila this 11" day of August in the year of Our Lord Nineteen Hundred and Ninety-Eight. oon eZ RONALDO B. ZAMORA Executive SecretaryChapter 2 Table 24 22 23 28 25 26 27 28 29 2.10 211 2.12 243 214 215 2.16 Chapter 3 Table Bla 3.1b 32 33 34 35 3.6 37 38 39 3.10 3.1 3.12 3.13 34 LIST OF TABLES SOCIAL REFORM AND DEVELOPMENT Gender Empowerment Measure ~ Infant and Maternal Mortality Rates in Selected Provinces, 1995 Education and Manpower Development Indicators Status of UDHA Implementation as of June 1998 ~ National Shelter Program, 1993-September 1998 ~ National Shelter Program Socialized Housing Program Accomplishment Collection Efficiency Rate, 1993-1998 ~ ‘Actual Share of Social Services in the National Expenditure Program,1993-1997 (In real terms) Growth Rate of Social Services in the National Expenditure Program, 1993-1997 - Basic Social Services, 1993-1997 ~ Local Government Expenditure, 1993-1994 Social Allocation and Human Development Priority Rates, 1995-1997 Ratio of Human Development Priorities to Total ODA, 1993-1998 Responses to the Financial Crisis ~ Social Sector Expenditure Program, 1997-1999 Functional Literacy Rates of Selected Provinces, 1994 AGRICULTURE, AGRARIAN REFORM AND NATURAL RESOURCES GVA in Agriculture, Fishery, & Forestry Sector, By Region, 1993-98 (In Thousand Pesos) GVA in Agriculture, Fishery, & Forestry Sector By Region, 1993-1998 (Growth rates in percent) Subsectoral GVA Growth, 1993-1998 -. ‘Average Growth in Yield (metric ton per hectare) for Agricultural Crops, 1993-98. Livestock and Poultry Production, 1993-1998 (Growth rate in percent) Fishery Production, 1993-1998 (Growth rates in percent) Land Distribution Accomplishments by ‘Type of Land ~ ‘Agriculture Performance: Selected Asian Countries (Growth rates in percent) ‘Comparative Yield of Major Crops in Selected Asian Countries, 1998 ~ Agriculture GVA Targets, By Commodity, 1994-2004 -. Agricultural Performance: Selected Asian Countries (Growth rates in percent) ~ ‘Agriculture Production Targets, 1999-2004 (Growth rates in percent) Land Distribution Target, By Type of Land, 1999-2004 |- DAR’s Land Distribution, Accomplishment and Target by Region,1999-2004 DENR's Land Distribution, Accomplishment and Target by Region ~Chapter 4 Table 4a 42a 4.2b 43 44 45a 45b 46a 4.66 47 48 49 4.10 441 Chapter 5 Table Sa 52 53 34 55 56 37 58 5.98 5.9 5.10 Sala s.A1b 512 5.13 saa 5.5 5.16 5.17 5.18 INDUSTRY AND SERVICES GDP & GNP Growth Rates, 1993-1998. Gross Value Added by Industry Origin, 1993-98 Share to GDP & GNP Gross Value Added by Industrial Origin, 1993-98 - Employment by Sector, 1993-1998 Other Employment Indicators, 1993-1998 Gross Value Added in Industry Sector, At Constant Prices, By Region, 1993-1998 Gross Value Added in Industry Sector, Growth Rates, by Region, 1993-1998, Gross Value Added in Service Sector, At Constant Prices, by Region, 1993-98 ---4-39 Gross Value Added in Service Sector, Growth Rates, by Region, 1993-98 Industry Sector: Target vs Actual Performance, 1993-98 Service Sector: Target vs Actual Performance, 1993-98 Number of Travellers by Regional Destination in the Philippines, 1995-98 Industry GVA Targets, By Region, 1999-2004 Services GVA Targets, By Region, 1999-2004 Appendix 4.1, Services Subsectors: Gaps and Concerns. INFRASTRUCTURE DEVELOPMENT Cumulative Installed Generating Capacity. ‘Assessment of Different Energy Sources Available in the Country Average Rates of Asian Electric Utilities, 1997 System Losses By Region, 1997 ‘Comparison of Transmission and Distribution Losses in Selected Asian Countries, 1994 - Caps on Recoverable System Loss Energy Mix, 1999-2004 Cumulative Installed Generation Capacity, 1999-2004 Electrification Program, 199-2004 (Household Connections) Electrification Program, 1998-2004 (Barangay) ~ Electric Cooperatives Households Connection Program By Region, 1999-2004 Energy Sector Development Program Estimated Financial Requirements, 1999-2004 Energy Sector Development Program Estimate ‘Annual Financial Requirements, 1999-2004 Priority Subsector Activities: Energy Sector ~ Road Densities and Paved Road Ratios, Philippines and Other ASEAN Developing Countries Total Road Lengths and Paved Road Ratios by Classification, Philippines ~ Percentage of Paved and All-weather National Roads (1992 and 1998) Regional Distribution of Investments and Paved National Road ~ ‘Transportation Infrastructure Development Program Estimated Financial Requirements, 1999-2004 1999-2004 DPWH Medium-Term Infrastructure Program Priority Subsector Activities5.21 5.22 5.23 5.24 5.25 5.26 5.27 5.28 5.29 5.30 531 Chapter 7 ‘Table W 12 73 14 15 16 14 18 19 7:10 a 712 113 714 TAS 7.16 TAT Postal Network Development Physical Target Priority Sub-sector Activities Water Resources Development Program, 1999-2004 NIA Irrigation Program, 1999-2004 - BSWM Irrigation Program, 1999-2004 BSWM's Accomplishments and Target Water Supply and Sanitation Project, LGU-Level I. Water Supply and Sanitation Project, LGU Urban Water Supply & Sanitation Project - Level II Regional/Provincial Breakdown, 1999-2004 -. LWUA's List of Projects Per Region, 1999-2004 Priority Sub-sector Activities MACROECONOMIC FRAMEWORK AND DEVELOPMENT FINANCING Real Sector Indicators, Targets and Actual Performance, 1993-98 Real Gross Regional Domestic Product, 1993-98 — ‘Average Annual Income, Poverty Incidence and Per Capita Poverty Thresholds, 1994 and 1997 Labor and Productivity Indicators, Targets and Actual Performance, 1993-98 Selected Indicators for Monetary and External Sector, Plan and Actual, 1993.98 — Consolidated Public Sector Financial Position, Targets and Actual Performance, 1993-98 National Government Fiscal Position, Targets and Actual Performance, 1993-98 Financial Operations of 13 Major Non-Financial Government Corporations, Targets and Actual Performance, 1993-98 ‘Sectoral Allocation of National Government Expenditure, 1993-98 ~ Growth Scenario in the Medium-Term, 1999-2004: Regional GDP Growth Rates in the Medium-Term, 1999-2004 Projected Employment by Sector, 1999-2004 Regional Poverty Incidence Targets Monetary and External Targets, 1999-2004 National Government Fiscal Targets, 199-2004 -- Consolidated Public Sector Financial Position Targets, 1999-2004 Sectoral Allocation of the Budget, 1999-2004 vilChapter 1 Chapter 2 Chapter 3 Chapter 4 Chapter 5 Chapter 6 Chapter 7 LIST OF FIGURES DEVELOPMENT CHALLENGES Figure 1.1 GNP and GDP Growth Rates, 1987-98 Vd SOCIAL REFORM AND DEVELOPMENT Figure 2.1 Philippine Human Development Index, 1960-95 241 Figure 2.2. Human Development Index of Selected. Asian Counties cnn 23 AGRICULTURE, AGRARIAN REFORM AND NATURAL RESOURCES Figure 3.1 Gross Value Added In Agriculture, Fishery and Forestry, 1993-1998 Figure 3.2 Average Share of Agriculture, Fishery and Forestry to the Sector's GVA, 1993-1998 Figure 3.3. Average Annual Subsectoral Share in Total Agricultural Output, 1993-1998 .. 133 Figure 3.4 Management Perspectives in Convergence Sustainable Development 3:26 Figure 3.5 Convergence Model Sites for Sustainable Development 3-25 INDUSTRY SERVICES Figure 4.1 Industry and Services GVA, By Regional Shares, 1993-1997 o ; 42 INFRASTRUCTURE DEVELOPMENT Figure 5.1 Major Interconnection Projects Figure 5.2 Luzon Power Grid Figure 5.3 Visayas Power Grid Figure 5.4. Mindanao Power Grid ... Figure 5.5 Luzon Arterial Roads Program Figure 5.6 Visayas Arterial Roads Program ... Figure 5.7 Mindanao Arterial Roads Program... Figure 5.8. NCR Roads Projects Figure 5.9 Metro Manila LRT System Figure 5.10 PPA Port System. . Figure 5.11 Telephone Distribution by Region . Figure 5.12 Telephone Service Area Scheme ... Figure 5.13 Major Telecommunication Projects Figure 5.14 Internet Service Providers Figure 5.15 Cellular Site Locations & Coverage Figure 5.16 Major Flood Control Projects Figure 5.17 Major River Basins GOVERNANCE AND INSTITUTIONS DEVELOPMENT Figure 6.1 The Government Bureaucracy (1997): Number of Civil Servants 1. 6-2 MACROECONOMIC FRAMEWORK AND DEVELOPMENT FINANCING Figure 7.11997 Poverty Incidence «0 13AFMA AFTA AMCFP APEC APIS ARBs ARCBC ARCs ARF ARMM ASEAN ASPAC ATO BAP BCDA BHW BJSTP BOD BOO BOT BSWM CAR CARP CBFM CBOs CBRMA-PA CCPU CDA cpcs CDF CEP CESO CESP CEZA CHED CHIPS CIA cIpss cis CISFA CLG CLOA LIST OF ACRONYMS Agriculture and Fisheries Modernization Act ASEAN Free Trade Area ‘Agro-industry Modernization Credit and Financing Program Asia Pacific Economic Cooperation Annual Poverty Indicators Survey Agrarian Reform Beneficiaries ASEAN Regional Center for Biodiversity Conservation Agrarian Reform Communities Asian Regional Forum ‘Autonomous Region of Muslim Mindanao Association of Southeast Asian Nations Asia-Pacific Air Transportation Office Bankers Association of the Philippines Bases Conversion and Development Authority Barangay Health Worker Barangay Justice System Training Program Biochemical Oxygen Demand Build-Operate-Own Build-Operate-Transfer Bureau of Soils and Water Management Cordillera Administrative Region Comprehensive Agrarian Reform Program Community-Based Forest Management Community-Based Organizations Community-Based Resource Management Agreement for Protected Areas Civilian Crime Prevention Units Cooperative Development Authority Countryside Development Communication Service Countrywide Development Fund Coastal Environment Program Career Executive Service Officer Comprehensive Employment Strategy Program ‘Cagayan Economic Zone Authority Commission on Higher Education Child Help Intervention and Protection Services Congressional Initiative Allocation Comprehensive and Integrated Delivery of Social Services Communal Irrigation System ‘Comprehensive and Integrated Shelter Financing Act of 1994 Center for Local Governance Certificate of Land Ownership AwardCLRE CLUP CMDCI CMP CMTS CNS/ATM. co COA cop COE cop cops CRM CSA csc cTs DA DAR DBM DECS DENR DGIP DILG DND DOF DOH DOJ DOLE DOSRI DOST DOTC DPWH DSM DSWD DTI DTS EBB EC ECCD EDCOM. EEZ EIA EUB EIS ENROs Contingent Liability and Rehabilitation Fund Comprehensive Land Use Plan Capital Market Development Center, Inc. Community Mortgage Program Cellular Mobile Telephone Service Communications Navigation Surveillance/Ait Traffic Management Capital Outlay Commission on Audit Center of Development Center of Excellence Committee on Privatization. Community Oriented Policing System Coastal Resource Management Civil Service Academy Civil Service Commission Case Tracking System Department of Agriculture Department of Agrarian Reform Department of Budget and Management Departinent of Education, Culture and Sports Department of Environment and Natural Resources Development of Governance Indicators for Poverty Department of Interior and Local Government Department of National Defense Department of Finance Department of Health Department of Justice Department of Labor and Employment Directors, officers, stockholders and related interest Department of Science and Technology Department of Transportation and Communications Department of Public Works and Highways Demand-Side Management Department of Social Welfare and Development Department of Trade and Industry Dual Training System Electronic Bulletin Board Electric Cooperative Early Childhood Care and Development Congressional Commission on Education Exclusive Economic Zone Environmental Impact Assessment Economic Intelligence and Investigation Bureau Environmental Impact System Environment and Natural Resources OfficesEO EPR ETEEAP EUs FARMCs FBs FCDU FIC FMD FMIS FP FPISDA FRSS FSP FXTBs GAD GAMA. GASTPE GBA GCR GDP GEM GMDSS GMOs GMPCS GNP Gocc GOLD GSIS GVA HACCP HDI HDMF HEL HEMIS HIGC HLURB HSBBTS YAHC ICAO ICPB ICZM IDA IDD Executive Order Effective Protection Rate Expanded Tertiary Education Equivalency and Accreditation Program Environmental Units Fisheries and Aquatic Resources Management Councils Farmer beneficiaries Foreign currency deposit unit Fully immunized child Foot and mouth disease Forest Management Information System Family Planning Formulation of Performance Indicators and Standards for Development Administration Forest Resource Securitization Strategy Fishery Sector Program Fixed-rate Treasury bonds Gender and Development Gintong Ani for Marginal and Poverty Stricken Areas Government Assistance to Students and Teachers in Private Education General Banking Act Greater Capital Region Gross Domestic Product Gender Empowerment Measure Global Maritime Distress Safety System Genetically-Modified Organisms Global Mobile Personal Communication by Satellite Gross National Product Government-Owned and/or -Controlied Corporation Governance and Local Democracy Project Government Service Insurance System Gross Value Added Hazard Analysis and Critical Control Points ‘Human Development Index Home Development Mutual Fund Higher Education Institution Higher Education Management System Home Insurance and Guarranty Corporation Housing and Land Use Regulatory Board High-Speed, Broad-Band Transmission Services International Animal Health Commission International Civil Aviation Organization Integrated Capability Building Program Integrated Coastal Zone Management Iron Deficiency Anemia Iodine Deficiency Disorder