MANILA - The government is prioritizing more costly infrastructure projects because the Philippines' looming entry into the ranks of upper middle income countries means it will no longer qualify for special Japanese funding, one of the country's economic managers said on Tuesday.
Socioeconomic Planning Secretary Ernesto Pernia said the government wants big projects like the Metro Manila Subway and North-South Commuter Railway to move forward faster before the country achieves upper middle income status.
Pernia said that if the Philippines achieves this, it would no longer be eligible for Japanese Special Terms for Economic Partnership or STEP funding, which gives the country more favorable terms.
"So we would be on a non-STEP funding," Pernia said during a press conference in Clark, Pampanga.
He said the government was expecting the Philippines to achieve upper middle income status in the latter part of this year, but because of the recent slowdown in growth this may be "moved back to next year."
According to the World Bank, upper-middle-income economies are those in which gross national income per capita was between $3,956 and $12,235.
Pernia said that the National Economic and Development Authority Board has already approved 12 projects costing P1.6 trillion to be funded through official development assistance from Japan.