MANILA, PHILIPPINES (14 November 2019) — The Asian Development Bank (ADB) has approved a $300 million policy-based loan to support the Philippines’ efforts to help local government units (LGUs) across the country deliver high-quality and accountable services, boost economic development, and reduce poverty.

The Local Governance Reform Program (LGRP) subprogram 1 is empowering and equipping LGUs to meet the needs of citizens and ensure they deliver services aligned with local preferences, improve their capacity to raise their own revenue, and lower the cost of doing business for the private sector.

The program is in line with the government’s plan to expand the role of LGUs as catalysts of local economic development, as outlined in the Philippine Development Plan 2017–2022.

“ADB supports the Philippine government’s goal of creating a high-trust society, where citizens have confidence in the capacity of local government institutions to deliver services to communities and provide a simpler business environment for private enterprises. A healthy business environment will lead to more jobs and strengthen the local economy,” said the Director for Public Management, Financial Sector, and Trade at ADB’s Southeast Asia Regional Department Mr. Jose Antonio Tan III.

The Philippines is a relatively decentralized nation, especially when compared with its neighbors in Southeast Asia. ADB has partnered with the government since 2006 on a program of major reforms to ensure decentralization results in inclusive growth, quality service delivery, and better economic opportunities for a rapidly growing population.

As part of more recent efforts to empower LGUs, the government has embarked on reforms to strengthen the legal framework for local service delivery to clarify roles and responsibilities, distribute shared taxes more fairly, and improve the ability of local governments to partner and coordinate on delivering key services.

“The ADB program under LGRP is helping the government provide LGUs with the tools and skills necessary to deliver high-quality public services in an accountable and cost-effective manner,” said ADB Public Management Specialist for Southeast Asia Mr. Robert Boothe.

In 2017, the government institutionalized a three-tier competency scheme and certification program under the Standardized Examination and Assessment For Local Treasury program to ensure local treasury officers are equipped with the necessary skills and competencies to manage local resources.

The government also developed and implemented an online LGU client rating system for business permit application and releasing to enhance citizen feedback on LGU performance and service delivery. Such measures are helping to raise the country’s overall attractiveness for private sector investment.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. In 2018, it made commitments of new loans and grants amounting to $21.6 billion. Established in 1966, it is owned by 68 members—49 from the region.

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