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Introduction

The Duterte Administration has promised a lot of things to the Filipino people ever since
the election of his presidential campaign. The first thing that he promised was to solve the drug
problem in the Philippines, while the second thing is his promise to provide a better livelihood
for the Filipino people. As we all know, Philippines is a country that is still developing, which
means that the social, economic and political landscape are not yet perfect. In the aspect of the
economic landscape, the Filipino people are suffering from poverty, unemployment and even
the rise of prices of goods. Through this issue, the Duterte Administration figured a strategy on
how the Philippines can best develop. This strategy is called the Build Build Build Program.

The Build Build Build program is an initiative from the Duterte administration that aims
to shift the resources of the country to investments on infrastructures that will contribute to the
economic growth of the Philippines. The initiative proposed $180-billion (P9-trillion) to usher
a “golden age of infrastructure” and its priority is to build ports, airports, roads to uplift the
lives of the Filipinos. Along with its visions, the program promises to create 1.7 million jobs
to the Filipinos and reduce poverty by 2022. In the words of President Duterte (2018), himself,
“Our Build, Build, Build program will provide the solid backbone for growth. This will
continue to upgrade the infrastructure, connect more people and communities and create more
jobs. Already we have started a three-year rolling program amounting to over US$69 billion
until 2022,”.

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 According to BCDA (2018), “Among the key infrastructure projects under the Build
program include the construction of the Subic-Clark Railway; North-South railway projects
connecting Los Baños, Laguna to Tutuban in Manila and to the Clark Freeport in Pampanga;
the 1,500-hectare industrial park in Clark; and, the expansion of the Clark International
Airport—the first hybrid public-private partnership project rolled out under the Duterte
administration. These are joint projects of the Department of Transportation (DOT) and the
Bases Conversion and Development Authority (BCDA).” The National Economic and
Development Authority gathered data and claimed that the Build Build Build Program will
lead the government to borrow almost half (48%) of its funds from foreign lenders. As of June
(2017), these were the amount of money the Philippine Government borrowed from foreign
countries and institutions:

Country Money Borrowed

Japan (3 projects) P226.89 billion

China (3 projects) P164.55 billion

South Korea (2 projects) P14.06 billion

World Bank (1 project) P4.79 billion

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 According to Cherryl Cruz (2017), there are certain risks that adhere with respect to the
“Build, Build, Build Plan” and will heavily burden the poor and average income earners. She
emphasized that the spending on these infrastructure projects will be a huge burden on the
national budget deficit, and that necessary debts can occur. With this, the government plans to
compensate for this by reforming the tax structure, which will cut the income tax to 25 percent
from the current 32 percent. According to fund manager Wilson Sy, this will allow them to
“maintain fiscal responsibility while increasing infrastructure spending.”

Despite this promise, reforming the taxes can lead to three changes: Higher value-added
tax (VAT), Higher and expanded excise tax on all petroleum products and Sugar excise tax. In
the end, many Filipinos will still feel the burden of the huge debt incurred by the government.

The issue has arisen from the way the people feel the economic risks of the Build Build
Build Program. They have yet to see the fullest potential of this program, because the vision is
still abstract right now and the Philippines is still transitioning to this initiative. Now that the
country is in the middle of this shift, people who are poor and vulnerable are protesting for the
drastic adjustments of their lifestyles that ultimately emphasizes how their lives have become
harder.

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 Social Analysis

1. Economic Factors

According to Sicat (2018), there are four economic risks on the build-build-build
program; inflation; exchange rate changes; interest rate changes; and the contractor choice.
Inflation is the rate at which the average prices of the “basket” of goods and services increases
over a period of time. This means that the people are paying much more than what they usually
pay for compared to when inflation was lesser. It also weakens the currency and reduces the
purchasing power of products (Floyd, 2018).

One major issue which causes the abrupt increase in inflation is due to the
implementation of the Tax Reform for Acceleration and Inclusion law or otherwise known as
the TRAIN law. This law which was signed by Duterte seeks to impose new taxes on “sin”
products such as petroleum, vehicles, sugary drinks and many more (Ocampo, 2018). It also
increases taxes on person with an annual income of P250,000, which means that workers that
earn more are required to pay higher taxes. Although it has good implications and that the taxes
are also used to partially fund the build-build-build program, the poor are greatly affected by
the increase of prices in their basic commodities. This is a harm that is felt mostly by the people
who only have minimal budget for their day to day living and given that this policy is slowly
implemented, they must have to compromise and cut back on their expenses and adjust to the
drastic rise of prices, which can result them to have a harder life.

Another economic risk is the exchange rate changes and interest rate changes. The
monetary value of peso has weakened since the government will be spending more on the build-
build-build program, which would also mean that imported goods and services would cost
more. Changes in monetary value may also encourage Filipino workers to choose working
abroad in order to have a higher income or wage, since they would be earning more for every
dollar they earn exchanged to Philippine peso (Daily Inquirer, 2015). As a result, the build-
build-build program was delayed even further due to lack of skilled workers and expensive
production costs. The problem is that although we have a strong labor force, majority of the
workers lacks the skills or isn’t qualified for large scale infrastructure projects. This is quite
contradicting since the program was intended to provide jobs for the poor. According to Philstar
(2018), Duterte claims that majority of the country’s skilled workers are working abroad in the
Middle East.

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 This would then lead to the final economic risk which is the contractor choice.
According to Sicat (2018), there is always a possibility of failure that a project could have due
to the poor choice of contracting parties. This could happen whether the source of financing is
official development assistance or some private contracts, as in PPP (public-private
partnership) projects. Corruption contributes to the prevalence of poor implementation of
projects because of contractor failure.

Despite all these economic risks or issues on the build-build-build program, the real
question lies on who would benefit and suffers from it. Due to economic inequality, only a few
workers would benefit from it, leaving the poor working harder for a very low wage. People
remain poor because economic trends don’t help those working in the farming or fishing sector,
which yielded the highest poverty rates in the Philippines (Jennings, 2018). Philippines has
always been an agricultural country, however, with Duterte’s take on making the Philippines
an industrialized country, the majority working in the agriculture sector suffers from the
implementation of the program. More and more farming areas are converted to buildings and
trees being cut down for construction purposes. This also changed the culture of many Filipinos
which shifted their attention to work in the industrial and service sector.

Although the project promises more jobs in the future, it does not change the current
situation for those people suffering from poverty today. The people with above average income
could endure the sudden change in the tax reform system in the reign of Duterte. However,
those with poor and average income would have a problem adjusting to the sudden price hikes.
Only if the government could increase labor wages and provide free professional training for
those inexperienced laborers could they help uplift the poor from poverty, in order for them to
earn enough money to feed and provide for their own families.

2. Political Factors

The government oversees the whole operation in the build-build-build program and is
responsible for funding the project. However, due to economic inequality only a few could ever
benefit from the build-build-build program. Large corporations, businesses, foreign and local
contractors would most likely become the beneficiaries of the program. This leaves the poor
and unprofessional workers with lower pay.

One major issue is the presence of corruption in the government. The program is
supposed to improve the poor infrastructure of the country. Yet some projects up to this date

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are still unfinished and has exceeded its completion date (CMFR, 2018). According to Ilagan
K. and Mangahas M. (2018), ten contractors under Duterte runs a record of fraud, delays and
blacklisting. Three contractors had been suspended or blacklisted, four are accused for alleged
grafting and two had connections to politicians with sealed deals via financial favors exchange.
All these contractors share a record of incomplete projects and unsatisfactory ratings in
performance evaluations. Some believe that the money which is supposed to fund these
unfinished projects were used to funding the election campaign, in which officials reluctantly
reject any claims.

Another major issue is the budget allocation from the DPWH. It was only during
Dutertes’ regime that Region XI or the Davao region shot up to the top of the DPWH ranking
for Infrastructure spending per capita by region (Manghagas, 2018). Because of this, populous
regions such as CALABARZON, Metro Manila and Central Luzon suffered from cuts from
budget allocation. This is not the first case that happened in the Philippines, even in Aquino’s
and Arroyo’s regime shows increased budget allocations on their home province. Aquino
hailing from Tarlac and Arroyo from Pampanga province, has Central Luzon as no.1 in the
year 2010-2012, no. 3 in 2013 and no.1 again on 2015 in the DPWH allocations. It was only
under the Duterte administration that the Davao region reached no.1 which a 119-percent
increase in its civil works budget from 2016-2017. However, this figure is exceedingly skewed
compared to Luzon’s island regions with 86.8 percent increases in civil works, not to mention
that it hosts approximately 39 million people in this region, which is twice the population of
Mindanao and ten times the population of Davao. Some regions in Luzon such as the Cagayan
Valley suffer greatly from budget cuts as well as Zamboanga del Norte from Mindanao. With
Davao being favored for civil work projects, many other regions are left with lower budget
allocations which could affect the lives of people living in these regions.

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