ASEM Financial Crisis Response Fund Review Meeting PHILIPPINES: Implementation Progress, Portfolio Performance and Results 28 June 2006 Presented by: Director Ma. Edita Z. Tan Department of Finance

PHILIPPINE CONTEXT Medium-Term Philippine Development Plan Assumes that: Improved governance is critical to poverty alleviation Priorities of the government: Raising fiscal revenues to achieve fiscal consolidation Improving expenditure management and public procurement Managing fiscal risks pertaining to contingent liabilities Strengthening and deepening the private sector Rebuilding investor confidence through improvements in Corporate Governance

FOCAL AREAS OF THE ASEM TF 2 Financial Sector Social Sector Governance Reform Pension Reform Strengthening Capacity for Bank Supervision Closing the Productivity Gap Poverty Monitoring and Analysis Strengthening Reforms in the Urban Shelter Programs for the Poor Knowledge Enhancement of Key Issues in Corporate Governance Strengthening Institutions for Sustainable Poverty Reduction and Good Governance Strengthening the Capacity of Procurement Institutions for Sustainable Good Governance Strengthening the Office of the Ombudsman for Good Governance

FOCAL AREAS OF THE ASEM TF 2 Relevant Figures: Total Grant Amount = US$ 5.22 Million No. of Programs = 9 No. of Projects = 12 Completed = 5 On-Going = 6 Cancelled = 1

PERFORMANCE OF COMPLETED ASEM TF PROJECTS

OUTCOMES OF COMPLETED PROJECTS Closing the Productivity Gap (TF051862) Workshops were held with key stakeholders to build consensus around recommended policy approaches to strengthen productivity growth Knowledge Enhancement of Key Issues in Corporate Governance (TF050955) A training program and manual on corporate governance was developed Strengthening Capacity for Bank Supervision (TF053181) Supported Central Bank’s efforts to align the IT and risk management policies with international best practices Pension Reform (Recipient-Executed) (TF052349) Provided a clearer perspective on the financial and actuarial position of the military pension system

STATUS OF ACTIVE ASEM TRUST FUNDS

DISBURSEMENT RATE (2004 TO 2006) Despite a slow start, disbursement rate picked up in 2006 Disbursed amount has now reached approx. 60% as of to date.

PROBLEMS ENCOUNTERED Design Problems: Overly complex project with multiple stakeholders Fragmented/small consultancies Solution: Regular meetings with the ICSC helped improve coordination and address bottlenecks Lumping together small assignments into one TA contract

PROBLEMS ENCOUNTERED (2) Implementation Issues: Difficulty in providing direct government counterpart funding requirement Problems with external project monitoring unit Solution: DOF realigned its budget to accommodate the counterpart costs Dedicated in-house staff reporting directly to the Undersecretary

MOVING FORWARD Possible Areas of Cooperation (High Priority): Economic and Financial Cooperation Regional macro-economic monitoring Regulatory economics Social Cooperation Social protection for the informal sector and other vulnerable groups Environmental Cooperation Energy efficiency

ASEM Financial Crisis Response Fund Review Meeting PHILIPPINES: Implementation Progress, Portfolio Performance and Results THANK YOU!