JUNE 25, 2024 — To raise the Philippine economy’s potential growth and bring the country closer to its vision of a strongly rooted, comfortable, and secure life for all Filipinos, the National Economic and Development Authority (NEDA) underscored the need for the government to strategically and consistently invest in human capital development.  

This call to action was made during the World Bank’s launch of the Philippines Human Capital Review on Monday, June 24.  

[Watch the report launch and forum of the Philippines Human Capital Review] 

NEDA Secretary Arsenio M. Balisacan expressed confidence in the country’s readiness to accelerate its economic growth, stating that the country has never been more prepared to take off and realize its immense potential with the current demographic shift it is experiencing. “This downward trend [in total fertility rate] has resulted in a fundamental shift in the age structure of our population. An exciting opportunity thus arises: we are currently in a ‘demographic sweet spot,’” he said.  

During his keynote speech, Balisacan highlighted the country’s demographic advantage of a predominantly young population. The Philippines’ median age is about 25, and 64 percent of the over 110 million Filipinos belong to the working-age group of 15 to 64 years old. “This demographic shift has enormous implications for our economic potential. A large, healthy, skilled labor force implies higher demand and productivity in the years and decades ahead,” he explained. 

The World Bank report acknowledged the country’s socioeconomic progress, but also identified challenges in human capital, particularly in nutrition and education among Filipinos aged 10 to 15. It warned that in disadvantaged local government units, about 26 percentage points of human capital potential stand to be lost if these challenges remain unaddressed.  

Balisacan also cautioned against the possible consequences of neglecting human capital, which may lead to unwanted futures: a future of health risks and limited creativity, a lack of critical thinking and innovation, delayed technology adoption, deep poverty, and worsening inequality.  

“Indeed, we are at a critical juncture in our nation’s socioeconomic history, and our actions will determine the future unfolding. This juncture becomes apparent when we consider the state of our human capital, its implications on the overall economy, and our relative performance across various development indicators,” he added.  

Balisacan underscored that the Philippines could grow rapidly and replicate the economic success stories of its East Asian neighbors during their rapid industrialization and development periods, but only under certain conditions. 

 “This is only possible if we get our acts right by making the right policy choices and investing heavily in human capital, especially in the early years of our people’s lives. These efforts to strengthen human capital will complement our initiatives to accelerate our infrastructure drive and create an enabling policy environment for productivity-enhancing investments and innovation toward sustaining rapid and inclusive economic growth,” the country’s chief economic planner said.  

He also outlined several government initiatives aimed at protecting and enhancing the country’s human capital. These include the Tutok Kainan Dietary Supplementation Program, the Walang Gutom 2027: Food Stamp Program, and the institutionalization of the Pantawid Pamilyang Pilipino Program Act as a national strategy for poverty reduction and human capital investment.  

“Investing in people is the cornerstone of realizing our shared vision—our desired future—of a matatag, maginhawa, at panatag na buhay for all Filipinos,” the NEDA Chief concluded. 

The full version of the report can be accessed at The Philippines Human Capital Review: Investing in the Early Years to Boost Human Potential. 

 

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