Philippines - Fisheries Credit Project

DOCUMENT OF INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT Not For Public Use Report No. P-1213--PH REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO THE REPUBLIC OF THE PHILIPPINES FOR A FISHERIES CREDIT PROJECT May 2, 1973 This report was prepared for official use only by the Bank Group. It may not be published, quoted or cited without Bank Group authorization. The Bank Group does not accept responsibility for the accuracy or completeness of the report.  CURRENCY EQUIVALENTS US$ 1.00 Pesos 6.78 Pesos 1,000 US$ 147.49 Pesos 1 million Us$ 147,493 FISCAL YEAR In the Philippines the Fiscal Year covers the period July 1 to June 30.  REPORT AND RECOMMENDATION OF THE PRESIDENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN TO THE PHILIPPINES FOR A FIaHERIES CREDIT PROJECT I submit the following report and recommendation on a proposed loan to the Republic of the Philippines for the equivalent of $11.6 million to help finance a project for providing medium- and long-term credit for the development of the fisheries sector. The loan would have a term of 17 years, including six years of grace, with interest at 7.25 percent per annum. PART I - THE ECONOMY 2. A report entitled ICurrent Economic Position and Prospects of the P:ilippines (78-PH dated April 20, 1973) was circulated to the Executive Directors on May 2, 1973. Since the previous economic report in May 197.2, the Philippines has suffered one of the worst floods of the century in the Central Luzon area, President Marcos has imposed martial law, and a new constitution, establishing a parliamentary system of government, has been promulgated. The President has announced that martial law will continue under the new constitution and that elections for a national assembly will be postponed for six or seven years. The President is undertaking social and economic reforms in the country and has announced that aside from law and order, implementation of an agrarian reform program is a high priorit-y in the Philippine development program for the immediate future. In addition to decrees on agrarian reform, the President has promulgated decrees on tax reform and on a number of bills which had been awaiting Congressional approval, including the customs and tariff bill and the government reorgani- zation bili. 3. In the past three years the authorities have pursued policies of monetary and fiscal restraint and have succeeded in improving substantially the maturity structure of the external public debt. In spite of this, the performance of the Philippine_economy hasg been somewhat disa ppinting, with real GNP increasing by about 5 percent a year. Expansion in the economy has been hampered by a combination of factors. First, a series of disruptions to agricultural output since 1970 that was capped by the severe floods in July 1972, have seriously retarded the growth of food, and in particular rice production. Second, there has been little improvement in export prices since 1970. At the same time, import prices have increased substantially, and the result has been a 30 percent deterioration in the external terms of trade. Because of this decline real gross national income per capita has been stationary at about $200 since 1970. Third, the economy has experienced a period of rapid inflation with consumer prices rising by more than 50 percent during the three years 1970-72 due to the combined effects of devaluation, imported inflation and shortfalls in domestic food production. These adverse trends have been especially serious for the wage earning group. There has been a 20 percent fall in real wages and a further rise in unemployment. However, in recent  - 2 - months the rate of inflation has been reduced substantially and there has been some recovery in the growth of real wages. 4. The floods in July, which caused extensive damage, made the economic situation in the Philippines more difficult. Plublic infrastructure, in particular, roads, flood control dikes, irrigation works and schools, were damaged. Together with production losses and damage to private property, the total cost of the flood damage was estimated at about $200 million. Because of the extensive damage to the rice crop, the Philippines' rice imports will be about 500,000 tons in FYI.973/74. This will furthler strain the balance of payments. In response to the flood disaster the Philippines received about $76 million in assistance from foreign governments and international agencies. 5. The administrative, fiscal and monetary reforms that the Marcos administration has begun to -implement under martial law could lead to improved economic performance in the years ahead. There can be little question that the Philippines has the resources - both physical and human - to achieve broadly based economic improvements, given the right policies and adequate suipport for development within the country and from outside. The main elem.ents of the Government's development strategy include: (a) improvement of agriculture and other rural conditions; (b) faster industrial and mineral development, including a large increase in manufactured exports; (c) an investment program that complements the sector development programs by balancing the allocation of resources between agriculture, industry and infrastructure; (d) financial manage- ment to encourage exports, limit inflation and its aggravation of income maldistribution, and furt;her improve the maturity pattern of the external debt; and (e) more adequate gover-nent revenue program and better public sector managemen't. 6. Capital formation in the Philippines is quite high, and the problem will be to ensure that investrment outlays are more effective in future. lThis would involve better use of industrial capacity than was achieved during the sixties and sharply accelerated public development outlays if bottlenecks in production are to be avoided and if the deterioration in social services is to be reversed. Public investment spending in FY 1972/73 is expected to be about I.5 billion pesos, compar-ed with 0.9 billion pesos in the previous year. Expenditures for rehabilitation, which are expected to reach about 500 million pesos in FY 1972/73, account for a large portion cf 1i increase. During 1973-77 the total public investment program is expected to be about 10 billion pesos. Ou-tlays would rise from about 1.7 percent of GNP in 1968-72 to about 2.6 percent in 1973-77. About 4o percent of the program would be for transportation, and 20 percent for power. Irrigation would account for about 14 percent. 7. Substantial additional taxation will be needed to finance the proposed public investment program. Public savings during 1970-72 were about 2 percent of GNP. A disappointing level of tax revenues was at the root of the problem. The tax reforms introduced since martial law have resulted in a substantial increase in revenue collections, wiith real revenues projected to grow by about 8 percent this financial year, despi-te the real GNP growth rate of only about 4 percent. A further rapid growth in revenues is expected  - 3 - again in FY74 But if the Government is to undertake its ambitious develop- ment program successfully, real revenues would have to expand by about 8 perce;it a year during 1973-77, which in turn means that the Government's fiscal effort will have to be intensified further. 8. If both economic policy and sectora:L growth evolve as described, incomes, employment and the balance of payments should ail improve. Even, however, with rather optimistic assumptions about improvements within the country and support from outside, the international payments position and import capability will be tight. Merchandise exports are projected to grow at about 8 percent a year during 1973-77, including a 3 percent increase in prices. Provided rice imports can be reduced after FY73/74 and imparts of other consumer goods kept at about current levels, imports of raw materials. intermediate goods and capital goods could be allowed to rise at about o-7 percent a year. This may be sufficient to provide for a 6-8 percent growth in GNP, without resulting in the balance of payments deteriorating. 9. The foreign capital inflow to be met from transfers, direct invest- ment and loan capital would need to be about $2,990 million, or about $660 million a year, during 1973-77. Grants and private remittances wouLd provide about $850 million and net direct investment about $60 m-_lion during 1973-77. Gross disbursements of medium- and long-term loan capi-tal woul-d have to be about $2,090 million during 1973-77, or about $420 million a year. Disbursements of commercial loans are estimated at about $1.1 billion during 1973-77. The balance of disbursements during 1973-77 of about $1 billion would have to come in the form of official development loans from bil-ateral and multilateral sources. During 1973-77 total disbursements of project assistance could amount to about $550 million. The balance of about $X40 mllion would be needed in the f'orm of quick disbursing commodity assistance. There would be need for official commodity aid disbursements of abou't $100 million a year over the next two years, at least, when the capacity to absorb project assistance would still be quite limited. The Philippines has received substantial amounts of commodity aid over the last two years. The Consultative Group, which last met in June 1972, has accepted that such aid will continue to be needed and has indicated amounts which do not fall far short of these levels. Disbursements of commodity assistance at these levels would help ensure a flow of raw materials that should be sufficient for a smooth expansion of the economy, and that would serve to avoid the potentially disruptive effects on output and employrment that follow from raw material shortages ind'oced by a lack of foreign exchange. 10. Provided imports can, in fact, be contained as indicated above, and provided the projected levels of official aid for commodity imports and project assistance are forthcoming, management of the Philippines' external debt and debt servicing, while difficult, would not present serious problems. The level of external medium- and long-term debt would rise from $1.8 billion at the end of 1972 to about $2.1 billion by 1977. The level of debt service would rise from about $410 miillion in 1973 to about $520 million in 1977, while the debt service ratio on public and private debt would decline from 27 percent in 1973 to about 25 percent by 1977. Even with the projected  official assistance program total service paymen-t would exceed the inflow of medium- and long-term loan capital by about $250 million during 1973-77. The heavy debt service will clearly be a handicap to the Philippine develop- ment in this period and it will require continued close scrutiny over foreign borrowing patterns to further improve the maturity structure of the debt. 11. The Philippine development program will continue to require resources in excess of expected local savings and of the foreign capital which will become available for financing the import component of development projects. Part of' these resources will be provided from commodity assistance. In addition some financing of local currency expenditures will be justified especially for projects of economic and social importance which need only limited amounts of foreign exchange. PART II - BANK GROUP OPERATIONS IN THE PHILIPPINES 12. The Philippines has received 17 Bank loans and two IDA credits totalling $290 million, net of cancellations. A little over half of the Bank Group's lending,about $t150 million, has been for priority infrastructure projects in power, transportation, water supply and education. The remainder has been divided about equally between agriculture and industry. About $75 million of this has been for irrigation, livestock, rice processing and rural credit and about $65 million for industry in three loans to the Private Development Corporation of the Philippines. 13. Of total Bank/IDA lending for the Philippines of $290 million, two loans and two credits totalling $52.2 million were made since the beginning of 1972 Disbursement on three of these havre Just begun while the fourth became effective on April 11, 1973. Of the remaining $238 million, the undisbursed balance on March 31, 1973 was about $47.2 million, almost all of which was accolnted for by five loans made since the beginning of 1969. Disbursements on three of these, all credit projects, are behind schedule due in part to the general economic slowdown in the Philippines following the February 1970 devaluation and the subsequent stabilization program. However, disbursements on these loans began to pick up last year, although the closing dates of two loans have recently been postponed. Annex II gives the status of Bank Group operations. 14. Future Bank/IDA lending will continue to concentrate on public infrastructure and agriculture. The Bank Group will also continue to help industry and provide more assistance for projects in the social sector. The Government is giving top priority to rural development and land reform. A recent Bank Agricultural Sector Study noted that expanding and improving irrigation was essential to support land reform and to permit agricultural production and rural incomes to increase. The Upper Pampanga project, at present under way, will make a vital contribution in the heavily tenanted areas of Central Luzon. Several additional irrigation projects are being prepared, the first of which will probably be ready for approval in FY 1974. The Government is formulating a rural development project and a number of settlement projects within land reform areas which may be developed into proposals suitable for Bank Group financing. Further loans are also  likely to be made over the next two or three years for rural credit and livestock. 15. Bank/iDA infrastructure lending will continue to emphasize transportation and power projects. A second port project. was appraised last December and is expected to be presented to the Executive Directors for approval in early FY1974. Further projects for highways, ports, ship- ping and power are being prepared for Bank/IDA financing, In the social sectors an IDA credit was signed in Januariy 1973 for a oecond education project and a proposed population project is being prepared. 16. With an increased number of possible lending operations in sight, I expect Bank Group lending to rise substantially above present levels provided that the econoim is managed reasonably well and that the Philippines continules to improve its capacity to prepare and implement projects. 17. IFC has made comnitments -in the Philippines totalling $64.5 million for Investments in nine coTpanies in the fie:Ld of developmant banking, power, telecommunications, ceramic tiles, paper, petroleum products, nickel mining and refining, and chemicals. Of these investments, as of February 28, 1973, $17.8 million have been sold, $0.4 million cancelled and $1.1 million repaid, leaving a net portfolio of $43 million. On the same date $17.8 million were undisbursed. Preliminary proposals have been received for an aluminum smelter and other projects in the pulp and paper, dinnerware, metal alloys and shipbuilding fields. PART III - THE SECTOR 18. Although the fisheries sector presently contributes only L percent to GNP, it has considerable economic potential. The arc hipelago with over 7,000 islands provides excellent access to fishing grounds and the coastline with its many estuarine areas is ideal for brackish water fish farming. Fisheries employ directly about 700,000 persons (about 5.5 percent of total labor force) mainly in the traditional sector and fish production is estimated to be about 1 million tons a year. Further, fish is a staple in the Filipino diet and provides about half of animal protein intake - more than milk, eggs and meat combined. Exports consist of shrimp and tuna and amounted to $5.4 million in 1971 while annual fish imports for human consumption, mainly canned mackeral from Japan, stood at a value of about $18 million. Domestic demand for marine products is growing rapidly and the Government proposes to give additional emphasis to fisheries development over the next several years. There is scope for productive investment in the commercial fishing fleet. It contains about 2,200 vessels, mostly small. However, the number of larger and more specialized vessels (over 70 GT) has increased in recent years to a level of about 500. The fleet is mainly based in the Manila area and around the Visayan Sea. In 1971 the commercial fleet caught 380,000 tons, representing only about 40 percent of the estimated potential. Inland fisheries also offer promising avenues for development. The annual production from fishponds is estimated at about 100,000 tons from about 170,000 ha (1971). Annual average yield of these ponds is about 570 kg/ha, which compares to 300 kg/ha in Indonesia and 1,700 kg/ha in Taiwan.  There is scope to increase both the area under fishponds and the yields. 19. While no specialized fishing port is yet in operation in the Philippines, Navotas (near Manila) is being developed into a fishing port with the financial assistance of the Asian Development Bank. The project, to be completed in 1975, will greatly improve marketing in the Manila area where a large proportion of total fish consumption takes place. While projected fish landings may not justify investments in specialized fishing port facilities at places other than Navotas, there is a growing need for improved marketing and distribution facilities to handle increased fish production throughout the Philippines. 20. There are about 33 shipyards in the country, mostly located near Manila. About eight of these are capable of constructing steel vessels up to a size of 1,000 tons. The rest mainly build and repair wooden vessels. Repair and maintenance facilities for the fishing fleet around Manila are adequate. 21. Institutional sources for fisheries credit are commercial banks, rural banks and the Development Bank of the Philippines (DBP). Credit from non-institutional sources such as traders, equipment suppliers, etc., has become very scarce because of the tight credit situation. Commercial banks are a source of Liort-term loans mainly for marine fisheries. The rural banks are a source of credit for inland fisheries but have limited themselves mostly to short-term financing. DBP is the only major source of medium- and long-term credit for fisheries development. Up to mid- 1972 DBP's fisheries loans totalled some $20 million equivalent. These loans accounted for about 13 percent of DBP's total loans for agriculture. However, during the past three years, DBP's loans to this sector have substantially declined because of lack of funds. 22. In November 1972, a Presidential decree was promulgated creating a Fisheries Industry Development Council under the chairmanship of the Secretary of Agriculture to formulate development policies in this field. The Department of Agr-iculture coordinates overall policy and the Bureau of Fisheries (BOF) implements it. The present policy aim is to be self sufficient in fish products. This means not only more and better equipped vessels and fishponds. It also means more supporting infrastructure and improved extension services. The proposed project would help meet these needs. PART IV - THE PROJECT Background 23. The proposed project was prepared with assistance of a mission of the FAO/IBRD Cooperative Program which visited the Philippines in January/February 1972 and was appraised by a Bank mission in November. Loan negotiations were held in Washington from April 16 to 18, 1973. The leader of the Government's negotiating team was Ambassador Eduardo Z. Romualdez.  7- The appraisal report (No. 105a-PH dated April 23, 1973) is being distributed separately to the Executive Directors. 24. The proposed loan would be the Bank Group's first operation in the Philippines exclusively for fisheries. Description of the Project 25. The project would assist the Government in carrying out its program of increasing fish production for domestic consumption by pro-viding supervised credit to be administered by DBP. It would provide credit to individuals and companies, over a four-year investment period, to finance marine fisheries including the construction of fishing vessels, ice-making facilities and slipways and the purchase of fish carriers and equipment. The project would also help develop inland fisheries by financing the construction, rehabilitation and improvement of fishponds. The project includes technical assistance by a marine specialist, a naval architect and a fish farming extension expert who would assist in implementing it. It also provides assistance in conducting studies needed to prepare future projects for fish marketing and smallholder fishponds. 26. The lending arrangments would be similar to those of the Rice Processing Project (Loan No. 720-PH) and Livestock Project (Loan No. 823-PH). The Bank loan would be made to the Government which would bear the foreign exchange risk and relend the proceeds to DBP under a subsidiary loan agreement. DBP would onlend the Bank funds, supplemented with its own resources, to sub-borrowers. 27. DBP, a wholly owned Government institution, has total resources of about $4 billion (us $596 million) making it the largest development bank in the Philippines and the most important source of finance for agriculture and industry. It has a professional staff of more than 700 including about 200' agriculturalists and engineers and has a wider experience in fisheries lending than any other institution in the Philippines. While DBP's overall financial position in the past has given cause for concern, it came under new management in 1970 and since then its financial situation has improved steadily. A loan of us$50 million to DBP from an international banking consortium,signed last year in London, will help to relieve the heavy pressure on DBP arising from debt service obligations incurred as a result of its guaranteeing a large amount of private foreign borrowing in the late 1960's. After the peso devaluation of 1970, many borrowers defaulted, leaving DBP to make good on its guarantees. Since then it has succeeded in collecting a substantial part of the loans in default and has foreclosed on collateral in other cases. 28. The proposed project would assist DBP to expand its lending for fisheries development and would improve the technical and administrative operations of its Fisheries Group. DBP has agreed to appropriate changes in the organization and lending procedures of this Group. The Bureau of Fisheries through its extension services has agreed to assist with technical  - a - appraisal and to provide technical supervision and guidance to the sub- borrowers. In order to do this the Bureau has agreed to employ a fish farming (aquaculture) extension and training specialist to train its own and DBP's Dersonnel for extension and appraisal using the facilities of the University of the Philippines (Fisheries College). I'ost and F'inancing of the Project 29. The total cost of the project is $18.5 million with an estimated foreign exchange cost of about $8.4 million. The Bank loan of $11.6 million would finance about 63 percent of total cost. It is estimated the loan would cover the full foreign exchange cost of the marine fisheries component and technical assistance and 50 percent of the total cost of the fish-pond component which has an average foreign exchange component of only about 10 percent. Operators would finance on average approximately 14 percent, of project cost from their ovm resources and th_ remainder would come from DBP. The financing pattern is set out below: Sub Item Borrowers DBP Govt. IBYRD Total ($1,000) Marine Fisheries 1,720 - 6,880 8,6oo Inland Fishieries 810 3,210 - b,030 8,050 Technical Assistance - 70 70 310 45 Studies - - 60 380 440 Incremental Working Capital 100 860 - - 960 Total 2,630 4,140 130 11.600 18,500 Percent of Total 14 % 22 % 1 % 63 % 100 % The 't3.2 million of local costs that the Bank will finance will be entirely thr fishpond development, which has great potential for increasing rural incomes and for improving the diet of the population. It will also help to reconstruct and improve fishponds damaged in the 1972 floods. 30. DBP would charge an interest rate of 12 percent on sub-loans. The spread between DBP's lending rate and average cost of funds would be 4.5 percent which would be adequate to cover overhead and administrative costs and leave a reasonable net income. Sub-loans would be committed over a four-year period. Terms of sub-loans would be flexible and based on the needs of individual sub-projects. On average they would range from 5 to 13 years including grace periods of 1-3 years.  Project Execution 31. DBP's Fisheries Group would be responsible for implementing the credit operations. The Group would be headed by a senior officer. His staff would be strengthened by experienced technicians, a marine specialist and a naval architect employed under the technical assistance component. The Bureau of Fisheries would be responsible for the training program and the Department of Agriculture and Natural Resources would be responsible for employing and supervising the consultants who would prepare the two feasibility studies mentioned in para. 25. Procurement 32. Sub-borrowers for vessels would mainly be operators who already own several fishing boats. For this reason, the additional vessels must be equipped in a manner compatible with the owner's other vessels so as to minimize the costs of operating and maintaining the owner's total ileet. The hulls and the equipment would therefore be procured separately. Fishing vessels hulls would be acquired through local competitive bidding between prequalified local shipyards while engines, fishing gear and other equipment to be installed in the hulls would be chosen by individual operators from qualified suppliers represented or established in the Philippines. Suppliers not yet established or represented in the Philippines would have an oppor- tunity to do so since DBP would advertise internationally its intention to procure this equipment at least three months before quotations for the equipment were invited. Equipment for vessel improvements would be acquLred through normal trade channels because of the need to match and complement existing equipment. Second-hand carriers would be procured from abroad by advertising vessel specifications in potential supplier countries and allowing sub-borrowers to choose from lists containing surveyed and suitable carriers.Turnkey contracts for construction of ice-making facilities and slipways would be awarded after international competitive bidding in accordance with the Bank's guidelines. Competitive bidding for fishpond rehabilitation and development would not be appropriate because individual needs vary, sites are scattered and the work would be mainly performed by manual labor. Fishpond operators would therefore make arrangements, approved by DBP, for labor or contractors in their area to carry out the work. Disbursement 33. The loan would be disbursed to meet the full amount of DMP sub-loans (equivalent to the estimated foreign exchange cost) for all items except fishponds where 56 percent of DBP sub-loans (equivalent to 50 percent of sub-project cost) would be met. Disbursements would also cover the full foreign exchange cost or 90 percent of the total cost of technical assistance. Economic Justification 34. The project forms an important part of the Government's efforts to increase fish production, the major source of animal protein in the Philippines. At full development, i.e. within eight years, the project would have increased fish production by about h8,o00 tons a year, equal to  - 10 - about 5 percent of present fish production and valued at about US$13.2 million. The economic rate of return is estimated at 34 percent with a rate of 22 percent for the marine fisheries conmonent and 43 percent ior the inland fisheries component. Financial rates of return (after taxes) would vary from 20 to 27 percent for new investments and from b6 to 82 percent for supplementary investments, clearly high enough to create a demand for credit facilities under the project. The project would benefit about 1,100 sub-borrowers and their dependents, provide about 2,400 permanent positions for unskilled and semi-skilled fishermen and labor and employ about 4,000 unskilled labor per annum during the 4-year investment period. The project would also help the future development of fisheries by increasing knowledge of marine resources, demonstrating the value of improved operations, training extension staff, promoting sound lending practices and preparing two further projec-ts. PART V - LEGAL INSTRU"ENTS AND AUTHORITY 35. The draft Loan Agreement between the Republic of the Philippines and the Bank, the Report of the Committee provided for in Article TII, Section h (iii) of the ArticleS of Agreement and the text of a resolution approving the proposed loan are beirig distributed to the Executive Directors separately. 36. The draft Loan Agreement confozris to the pattern for previous loans for lending programs carried out through the Development Bank of the Philippines. A Subsidiary Loan Agreement, satisfactorv to the Bank, would be entered into between the Borrower and DBP, and the execution of ten Subsidiary Loan Agreement and the employment of a marine specialist and a naval architect are additional conditions of effectiveness of the Loan Agreement. The operating policies and procedures governing the onlending of the proceeds of the Loan are set forth in Schedule 5 to the draft Loan Agreement. 37. I am satisfied that the proposed loan would comply with the Articles of Agreement of the Bank. PART V - RECOMMENDATION 38. I recommend that the Executive Directors approve the proposed loan, Robert S. McNamarn President Attachments lay 2, 1973  Page 1 of 2 pages COUNTRY DATA - PHILIPPINES A-RE-A 2 POPULATION DENSITY 297,000 km million (mid-1972) 39.0 131 per km Rate of Growth: 3.0% (from 1960 to 1972) 1. per ho of Arabls lan.1 POPULA'ION CHARACTERISTICS (year) HEALTH (year) Cr:de Birth Rite (per 1,000) .6 Population per physician 2.819 Crude Death Rate (per 1,000) 11.4 Population per bospitai bed Infant Mortality (per 1,000 live births) 65 INCOME DISlRIBUTION (year) DISTRIBUTION OF LAND OWNERSHIP (yearj 7. of noational income, lowest quintile 3.6% 7. owned by top 10% of owners highest quintile 54.0% 7. owned by smallest 10% of owners ACCESS TO PITED WATER (year) ACCESS TO ELECTRICITY (year) 7. ofpopulation - urban 20% % of population - urban - rural ) 2%- rural NUTRITION (year) EDUCATION (year) Calorie intake as % of requirements 85% Adult literacy rate 72% 1/ Per capita protein intake(grams per day) 47 Primary school enrollment 119' 2/ GNP PER CAPITA in 1972 US $ 192 CROSS NATIONAL PRODUCT IN 1972 ANNUAL RATE OF GROWTH (%. constai,t __r_--j US v Mln. % 1960-65 1965-70 1971 GNP at Marke: Prices 8,468 100.0 5.5 5.7 6.s a Gross Domestic Tnvestment 1,674 19.7 12.6 1.6 5.9 -. Gross National Saving 1,470 17.3 15.0 3.6 13.2 -'A.: Current Account Balance -75 0.9 Exports of Goods, NFS 1,335 15.7 1.1.0 4.5 5.0 Imports of Goods, NFS 1,410 16.6 7.3 7.2 5-, OUTPLUI, LABOR FORCE D PRODUCTIVITY IN 1971- 14/ Value Added Labor Force 'V. A. Per Worker US$Mln. 7 Ml. % US _ Agriculture 1,332 32.4 6.4 48.5 2()8 18.2 Industry 1,059 25.8 2.1 15.8 504 al,.2 Services 1,717 41.8 4.0 30.0 429 37.6 Unallocated n 7 - Total/Average 4,108 100.0 13.2 100.0 311 1(JO. n GOVERNMENT FINANCE 5/ General Government Central Government Mln.) 7. of GDP ( Peso Mln.) % of GDP 197 197 196 -7 197 2 197 1 197, Current Receipts 1,416 8.9 8.3 Current Expenditure .4,033 8.0 7.6 Current Surplus ** .- 33 09 0.7 Cspital Expenditures .. .. .. 86 051 ExternaL Assistance (net) *- *- *- 374-' C76 1/ Includes overage students. 2/ The Per Capita GNIP estimate is at 1970 ma at prices, calculated by the same conversion technique as the 1972 World Atlas. All other conversions to dollars in this table are at the average exchange rate prevailing during the period covered. 3,' Constant 1967 prices. 4/ Total labor force; unemployed are allocated to sector of their normal occupation. "Unallocated" consists mainly of unemployed workers seeking their first job. 5/ Based on 'Actual' figures from the'Cash Budget'. Data prior to 1971 are not available. t'/ Counterpart funds from external commodity aid. not available not applicable - zero entry  Page 2 of 2 pages COmNTRm DATA - PHILIPPMS MOSEY. CREDIPT anid PRICES L965 1969 1970 1972 _272 (iMillion outstanding end period) Money and Quasi Money 5,797 9,761 10,922 12,258 13,836-/ 3ank .Cred't to Public Sector 980 3,565 3,479 3,907 -A 7351/ Bsan; Credit to Private Sector 8,223 13,139 15,396 18,010 21,9111_ (Percentages or Index Numbers) Mjoney and Quasi Money 3a 7% of GDP 24.1 29.8 27.3 24.3 25.0 General Price Index (1965 = 100) 100.0 111.4 137.7 159.3 175.3 Annual percentage changes in: General Price Index 2.2 1.3 23.6 15.7 Bank credit to Public Sector ,, 27.9 -2.4 12.3 6.7 Bank credit to Private Sector ,, 9.0 17.2 17.0 30.7 BALANCE OF PAYMENTS MERCHANDISE EXPORTS (AVERAGE 1370-72) 3S$ Mln 1970 1971 1972 Coconut products 230.3 rMillions US $) Sugar prducts 211.3 tO Forest products 264.6 Ps. E:ports of Goods, MiFS 1,331 1,397 1,418 Mineral products 217.3 O ; i-nports of Goods, NFS 1,349 1,422 1,460 Fruits and cther agricultural products 73.6 ` 7 SP source Gao (deficit = -) -lo Z5 42 Other manufactures 93. 8.5 Interest Payments (net) -1o5 -76 -92 All other cotmmodities Workers' Remittances - _ - Total 1,00.0 _ Other Factor Payrents (net) -25 -24 -33 2/ Net Transfers 119 134 188 EXTERNAL DEBT, DECEMBER 31. 1972- Rasance on Current Account -29