Powering the future: Promoting energy for inclusive growth

Transcription

1 Powering the future: Promoting energy for inclusive growth EPDP Conference January 2016 New World Makati Hotel ARSENIO M. BALISACAN, PhD Secretary of Economic Planning National Economic and Development Authority

2 Takeaway The Philippines has become one of the fastest-growing economies in Asia But it is important to sustain rapid growth and make it inclusive Infrastructure development is key to achieving inclusive growth The issue of providing energy access to all can be broken down into: availability, quality, affordability, compliance to SDG The goal of being a high-income country by 2040 can be met with the proper infrastructure support, especially for energy 2

3 GDP growth (annual %) Philippine growth from 2010 to 2014 is among the highest in Asia no longer the sick man of Asia. 10 Average growth of GDP per decade Indonesia Malaysia Philippines Singapore Thailand Vietnam Source: WB 3

4 The Philippine economy is on a higher growth trajectory since the beginning of the current decade GDP in 2000 billion Php, Real GDP growth 6.2% ( ) 6.1% (2014) 7.2% (2013) 6.8% (2012) Structural break of potential real GDP at around Source: PSA 4

5 in Billion Pesos % of GDP Growth-enhanced fiscal space has allowed major investments in infrastructure, with spending more than tripling... Public infrastructure spending, Billion Php and % of GDP Actual ( )/Program(2015)/Proposed(2016) Ratio to GDP (rhs) 0.0 Source: Department of Budget and Management Note: 2012 to Based on actual GDP and infra spending 2015 Based on 2016 BESF Program spending 2016 Based on 2016 BESF Proposed spending National Economic and Development Authority

6 However, weak performance in poverty reduction relative to the country s neighbors Lost decade in 2000s owing primarily to low income growth and to the high inequality of access to employment & social development opportunities Poverty headcount ratio at $1.25/day, PPP (% pop.) EAP (developing only) Indonesia Philippines Thailand Viet Nam China Source: WB 6

7 Lesson: we need to sustain rapid growth Continue addressing key infrastructure constraints Maintain high levels of public investments in human capital, particularly in health, education, and social protection Invest in disaster resiliency Deepen policy and institutional reforms toward substantially improving the business climate 7

8 Infrastructure: There have been improvements in the overall quality of infrastructure, but we re still lagging far behind ASEAN counterparts (142 economies) Infrastructure ranking ( ) 2012 (144 economies) 2013 (148 economies) 2014 (144 economies) 2015 (148 economies) Malaysia Philippines Thailand Indonesia Source: WEF Global Competitiveness Report

9 Access to energy for all as a strategy for inclusive growth Availability Quality Affordability SDG- compliance

10 Availability: Household Electrification Status Household (HH) Electrificati on Level (%) HH with electricity ( 000) Accomplishments Target ,184 16, , , , 896

11 Quality Survey Question: How would you assess the quality of the electricity supply in your country (lack of interruptions and lack of voltage fluctuations)? 1 = insufficient and suffers frequent interruptions; 7 = sufficient and reliable Country Rank Score Rank Score Rank Score Rank Score PHILIPPINES Cambodia Indonesia Malaysia Thailand Vietnam Total surveyed Source: EPDP, World Economic Forum, Global Competitiveness Report, various years.

12 Affordability in US$/kWh Residential in US$/kWh Industrial Source of basic price data: Philippines MERALCO; Indonesia- PLN; Thailand-EGAT, MEA; Malaysia- MEIH Stat; Singapore- SingStat, EMA and CPI- WorldBank

13 30 Residential Commercial Industry US /kwh ASEAN Power Rates (2011) Philippines electricity price is almost twice of the average price of the Region Source: ACE as Compiled by IEEJ (2013); from Del Mundo (ppt during 2016 EPDP conference)

14 toe/hab 8 Power consumption has been increasing, but still below consumption of our neighbors. Total Energy Consumption Per Capita kwh/cap Electricity Consumption Per Capita Indonesia Malaysia Philippines Singapore Thailand Japan China South Korea Source: EPDP, Enerdata Indonesia Malaysia Philippines Singapore Thailand Japan China South Korea

15 The poor pay a high price to meet their needs for energy Share of electricity, gas, fuels in the budget Average Poorest quintile Quintile 2 Quintile 3 Quintile 4 Richest quintile Source: FIES 2012

16 Impact of electrification on household welfare Source: Chakravorty, Emerick, and Ravago EPDP paper Lighting up the last mile: The costs and benefi extending electricity to the rural poor (today s presentation).

17 SDG-compliant Ensure universal access to affordable, reliable and modern energy sources Increase substantially the share of renewable energy in the global energy mix Double the global rate of improvement in energy efficiency Enhance international cooperation to facilitate clean energy research and technology Expand infrastructure and upgrade technology for supplying modern and sustainable energy services for all in developing countries

18 The Philippines share of renewable energy has been the highest in the region since In 2014, RE share stands at 33%. At the same time, the country has low CO 2 emissions. Share of Renewables in Electricity % tco2/cap C02 per inhabitant, 2014 Capacities Indonesia Malaysia Philippines Singapore Thailand Japan China South Korea Source: EPDP, Enerdata kco2/us$05 C02 intensity to GDP,

19 100% 80% 60% 40% 20% 0% Installed Capacity by Grid, by Source, 2015 Luzon Visayas Mindanao Installed Capacity, by Source, 2015 Oil Coal Renewables Natural Gas 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Expected Capacity Mix, 2019 Luzon Visayas Mindanao Expected Capacity Mix, by Source, 2019 Oil Coal Renewables Natural Gas Natural Gas, 2,862, 15% Oil, 3,608, 20% Oil, 3,639, 15% Natural Gas, 4,012, 17% Coal, 5,844, 32% Renewables, 6,138, 33% Coal, 9,261, 39% Renewables, 6,783, 29% Source: EPDP, DOE

20 GDP per capita (in current USD) The goal is to attain high income status by , , South Korea (2014) 20, PH future (Strong growth) 15, , , Rich-country threshold PH present ( ) 2043 PH future (Weak growth) PH past ( ) PH future (Daang Tiwali) PH future (Daang Matuwid) PH present ( )

21 GDP per capita (in current USD) With good governance and good economics, we are confident that we can achieve sustainable and inclusive growth in 2016 and beyond 30, , South Korea (2014) 20, PH future (Strong growth) 15, , , Rich-country threshold PH present ( ) 2043 PH future (Weak growth) Source: Ravago, Fabella, Alonzo, Danao, and Mapa Filipino 2040 Energy: Power Security and Competitiveness (EPDP presentation)

22 From Elsevier: Economic-Development/isbn From Amazon: -Economic-Development-Environment- Institutions/dp/ Online version: e/book/

23 Thank you! Copy will be uploaded in EPDP s website 23

24 Powering the future: Promoting energy for inclusive growth EPDP Conference January 2016 New World Makati Hotel ARSENIO M. BALISACAN, Ph.D. Secretary of Economic Planning National Economic and Development Authority