Housing in the Philippine Economic Agenda
ROLANDO G. TUNGPALAN Deputy Director-General, NEDA
22nd SHDA-HUDCC National Developers Convention 26 September 2013
We are on track with respect to our economic targets; the present challenge is to improve social outcome targets.
PDP 2011-2016 Targets
7-8% Gross Domestic Product
22% Investment/GDP ratio
6.8-7.2% Unemployment Rate
Poverty Incidence down to
16.6%
Where are we now?
Unemployment rate 7.0% (2012)
6.8% (2012) 7.6% (SI 2013) Real GDP Growth
20.3% (2012) 20.8% (SI 2013) Fixed Capital as ratio to GDP
7.3% (ave. of LFS’ 2013 Jan, Apr & Jul round)
Underemployment rate 20.0% (2012) 19.8% (ave. Jan, Apr & Jul 2013)
27.9% (S1 2012) 28.6% (S1 2009) Poverty Rate
Recently, the Philippine economy grew robustly. 2012 By Industrial Origin
Agri, Fishery, Forestry and Hunting Industry Of which: Manufacturing Services Gross Domestic Product (GDP) By Expenditure Household Final Consumption Gov’t Final Consumption Capital Formation o.w. Fixed Capital o.w : Public Construction Private Construction Durable Equipment Changes in Inventory Exports Imports Gross Domestic Product (GDP)
Source: NSCB
Share to GDP 11.1 32.0 22.1 56.9
2013 Q2
2013 S1
100.0
Growth Rate 2.8 6.8 5.4 7.6 6.8
Share to GDP 9.4 32.7 21.8 57.9 100.0
Growth Rate (0.3) 10.3 10.3 7.4 7.5
Share to GDP 10.2 33.0 22.6 56.8 100.0
Growth Rate 1.4 10.6 9.9 7.1 7.6
70.4 10.3 18.5 20.3 1.8 6.4 10.0 (1.8) 48.4 47.6 100.0
6.6 12.2 -3.2 10.4 29.8 11.5 8.0 (333.8) 8.9 5.3 6.8
67.0 13.1 17.4 18.9 2.9 5.7 8.6 (1.5) 47.1 45.6 100.0
5.2 17.0 13.2 9.7 31.1 9.0 5.7 19.0 (6.5) (3.0) 7.5
67.7 12.3 18.5 20.8 2.4 6.2 10.2 (2.3) 45.8 45.2 100.0
5.3 15.3 27.3 12.7 36.2 17.4 7.9 41.2 (7.0) (0.7) 7.6
Sound macroeconomic fundamentals supported this remarkable performance. Inflation has been within target since 2010 9.0 8.0
Inflation Inflation Headline Low Target High Target
in percent
7.0 6.0 5.0
4.0 3.0 2.0 2005
2006
* Jan - June 2013 only
Source: Bangko Sentral ng Pilipinas
2007
2008
2009
2010
2011
2012
2013*
Lessons Learned: Midterm Assessment of PDP 2011-2016 • Good governance has proven to be an effective platform upon which strategies should be implemented. • Macroeconomic (fiscal, financial, external) and political stability fuels positive expectations that lead to growth. • Economic growth is necessary but not sufficient for poverty reduction. • Growth strategies need to have spatial and sectoral dimensions to ensure inclusivity. • Disasters can negate the gains and even push back development. 5
Hence we need to do more to attain inclusive growth... Good Governance (Property Rights, Regulatory Efficiency, Alignment of policies) National Security, and Ecological Integrity
INCLUSIVE GROWTH (MASSIVE EMPLOYMENT CREATION, REDUCED POVERTY)
POSITIVE ACTION with Spatial and Sectoral Dimensions (e.g., economic and social programs)
Market demand
Rapid and sustained growth
Science, technology , innovation Education and skill set of the workforce
Infrastructure
jobs
Investments
Boost competitiveness
Improve access to financing
Macroeconomic Stability (fiscal, monetary, external, financial)
6
Guiding Principles in updating the PDP • Efficiency (catalytic; government intervention facilitates and not substitutes for private action) • Equity (broadening opportunities through connectivity, human capital investments) • Feasibility (doable within the Plan period)
The proposed 2014 budget will help us move towards inclusive growth...
• Government budget that – Facilitates massive employment generation – Helps to significantly reduce poverty
• Positive action with – Sectoral dimension – Spatial dimension
We assume that growth will continue in 2013 and beyond 2012 Actual
2013 S1 Actual
2013 Outlook
2014 Target
GDP Growth (%)
6.8
7.6
6.0-7.0
6.5-7.5
Agriculture Growth (%)
2.8
1.4
3.5-4.5
3.2-4.2
Industry Growth (%)
6.8
10.6
6.4-7.5
7.4-8.5
Services Growth (%)
7.6
7.1
6.3-7.3
6.7-7.6
Source: NEDA as approved in the DBCC
Growth Drivers Strong performance of agri-based manufacturing, and recovery of semiconductor and electronics Robust public and private construction projects Buoyant domestic and local tourism Continued strong growth of wholesale and retail trade Real estate particularly housing Greater productivity in agriculture and rebound of the fisheries subsector
We also remain vigilant against the following near-term global and domestic risks to growth... Possible spike in commodity prices (e.g. petroleum, agricultural products) Weather disturbances (e.g., El Niño and typhoons) Delays in the implementation of infrastructure development projects, particularly power Excessive capital inflows /outflows Uncertainty in the Euro area Fiscal risks in US and Japan Further economic slowdown in BRIC, particularly China
…while taking advantage of opportunities Improvement in the global economic environment Sustained growth in emerging markets Improvement in demographic conditions Increasing income, continued growth in population, rising middle income class Increased integration of the ASEAN Economic Community Well integrated ASEAN financial system
More financial resources available Fiscal space Investment grade credit rating *Luncintel, Global Industrial Application Paper Industry 2012-2017: Trend, Profit, and Forecast Analysis
Housing and Real Estate Sector
Real Estate Sector (In Million Pesos) 160,000
146,782
140,000
124,248
120,000 100,000
106,618 91,223
80,000 60,000 40,000 20,000 2009 Source: NSCB
2010
2011
2012
Share of Construction to Economic Output CURRENT PRICES
Construction (in million pesos) Gross Domestic Product (GDP) (in million pesos) Construction Share to GDP (in percent)
2010
2011
2012
551,229.7
520,968.8
618,077.4
9,003,480.0
9,706,267.8
6.1
Impact of 1 peso worth of Construction input to entire economy: 2000 Input-Output 1.99 Source: NSCB
5.4
10,564,886.5 5.9
Priority Sectors PDP 2011-2016 o Agribusiness/Forest-based industries o BPO/IT o Electronics o Housing o Infrastructure o Logistics o Mining o Shipbuilding o Tourism o Other high-growth potential industries (wearables, garments, homestyle products, motor vehicle parts/ components
Agri-business
Infrastructure
Tourism
BPO
Logistics
West Philippine Sea
PDP Midterm Update o Agribusiness/Agriculture o Manufacturing o BPO/IT o Housing o Infrastructure o Logistics o Tourism o Halal food industry
Assessment of Housing Peformance •
National Housing Program provided direct housing assistance to a total of 222,167 households during the period 2011-2012
•
Actual value of housing assistance for 2011-2012 amounted to Php 92 billion with 61 percent benefitting low-
cost housing and 49 percent for socialized housing • Generated about 2 million jobs in housing construction in 2011-2012
Assessment of Housing Performance KEY PROGRAMS
ACTUAL 2011 – 2012 HOUSEHOLDS
Socialized Housing (<Php 400,000) NHA Housing Production SHFC Community Mortgage Program HDMF End-User Financing Low Cost Housing (>Php400,000– Php3 million) HDMF End-User Financing LBP End-User Financing SSS End-User Financing Total Housing Assistance
TARGET HOUSEHOLDS
PHPBILLION
2011 – 2012
Accomplishment Rate (%)
153,696
35.66
253,247
60.69
103,093
25.87
140,000
73.63
25,162
1.53
45,000
55.91
25,441
8.26
68,247
37.27
68,471
56.43
181,753
37.67
67,753 606 112 222,167
55.09 1.20 0.13 92.10
182,376
37.15
435,000
51.07
Source: Housing and Urban Development Coordinating Council
Challenges in Housing Sector • Resource Constraints Original 1.5 million target reduced to 940,520
• Rapid Urbanization 49% in 2010; 65% by 2030
Target sectors: Nonformal workers, minimum wage earners, uniformed personnel, Informal settler families (ISFs), Indigenous Peoples (IPs) and formal sector
• NG-LGU Collaboration Land availability Resettlement
Funding for the Housing Program (In Million Pesos)
25,000 20,000 15,000 10,000
19,450
22,290
21,832
2012
2013
5,000
3,700
3,830
2009
2010
0 Source: DBM
2011
Strategies for Housing 1.
2.
3.
Target our clientele and financing with better and more responsive services for Pag-Ibig Fund members and the formal sector Identify and develop suitable land for sustainable communities Provide a more coherent and effective approach for the scaling up of socialized housing program through the National Informal Settlements Upgrading Strategy (NISUS)
Housing Policy Agenda • Amendment of Urban Development and Housing Act (UDHA) Section 18 • Review of PD 957 and BP 220 Implementing Rules and Regulations for inclusion of green technology in housing
Housing Targets, 2014-2016 (In households) Agency
2014
2015
2016
Total 2014-2016
NHA
67,291
92,525
80,422
240,238
SHFC
24,000
29,000
34,000
87,000
HDMF
55,516
56,672
57,861
170,049
146,807
178,197
172,283
497,287
Total Direct Housing Provision Source: HUDCC
Housing Sector Public Investment Program Housing
Expected output
Housing Program for ISFs in Danger Areas in Metro Manila (NHA)
89,634 housing units
Building Resilience & Awareness to Natural Disasters & Climate Change (BRACE) Project
1,800 housing units
Sub-Total
91,434 housing units
.
PDP RM Critical Indicators Addressed
Spatial Coverage (Nationwide, Interregional and Region-Specific*)
2013-2016 Investment Targets (In PhP Million)
Percentage of housing targets met
Metro Manila
40,000
Share of socialized housing to housing targets met
Taguig City, Metro Manila
1,914
Metro Manila
41,914
Housing Sector Public Investment Program Housing Resettlement (NHA)
Expected output
128,095 households
Emergency Housing 19,600 households Assistance (NHA)
PDP RM Critical Indicators Addressed
Spatial Coverage (Nationwide, Interregional and Region-Specific*)
Percentage of housing targets met
Nationwide
20,392
Nationwide
4,000
Nationwide
2,688
Share of socialized housing to housing targets met
2013-2016 Investment Targets (In PhP Million)
Settlements Upgrading (NHA)
65,492 households
AFP/PNP Housing (NHA)
80,000 households
Nationwide
23,502
Community Mortgage Program (SHFC)
106,000 households
Nationwide
8,535
Sub-Total Total .
293,187 households 384,621 households
59,117 101,031
MAGNITUDE OF INFORMAL SETTLER FAMILIES IN METRO MANILA (as of July, 2011)
Target for 2012-2016
(48%)
(27%)
(4%) (4%)
TOTAL: 584,425 HHs
27
APPROVED GOVERNMENT ASSISTANCE PERMANENT RESETTLEMENT SITE (by priority)
GOVERNMENT ASSISTANCE HOUSING
FINANCIAL
Php 18,000/family to be provided by DSWD IN-CITY 1. CSO Proposal/ Peopleâ&#x20AC;&#x2122;s Plans
2- to 4- storey LRBs (max. of P 400,000 per unit) Proposed Mode of Disposition: Ownership of Units (Proposal)
2. In-City LRBs (NHAimplemented)
2- to 5-storey LRBs Proposed Mode of Disposition on the Unit: Lease, Lease Purchase; Sale Usufructory Arrangement on the Lot (Proposal)
OFF-CITY (NHA resettlement sites)
Developed Lot with Rowhouse Disposition: Financing of the H&L by
To serve as rental assistance computed at P1,500 per month for a maximum of one year until such time that their resettlement sites are ready for occupancy
To serve as resettlement subsidy
Our challenges to SHDA