The Philippines comprises over 7,000 islands and has a population of 102 million (2016). It is ranked as a lower-middle-income country but there is an unequal distribution of wealth. Economic progress over the past decades has had only a limited impact on poverty reduction mainly owing to high population growth, unemployment, corruption, feudal politics and local conflicts.
The EU's support to the Philippines focuses on governance, job creation, renewable energy, health and assistance to vulnerable populations, specifically in Mindanao which has been affected by population displacement. The EU remains one the biggest foreign development partners to provide support to Mindanao and the Peace Processes through a comprehensive approach supporting directly the political settlement with the Instrument contributing to Stability and Peace (IcSP) and longer term development mainly through the Development Cooperation Instrument (DCI).
The EU-Philippines relationship has deepened further in recent years especially with the signing of the EU-Philippines Partnership and Cooperation Agreement in July 2012 (ratification process on-going). EU development assistance is closely aligned with the Philippine Development Plan 2017-2022 as an excellent medium term strategy for poverty reduction and achievement of the SDGs. The PDP provides a framework that allows the EU to align all its development cooperation programmes with Government policies and programmes with clear leadership and ownership on the part of the Philippine authorities.
The EU support strategy for the period 2014-2020 more than doubles EU grant assistance to the Philippines compared with the period 2007-2013, from EUR 130 million (PHP 7 billion) to EUR 325 million (PHP 17 billion). Most of the EU funds are given as grants making the EU jointly with EU Member States the largest grant donor in the Philippines. The Multiannual Indicative Programme 2014-2020 focuses on:
- The rule of law: the EU and the Philippines share a vision of improved governance and want to strengthen cooperation in the justice sector to support the Philippine Justice Sector Reform Strategy.
- Inclusive growth through access to sustainable energy and job creation: the EU is keen to help the Philippine Government to achieve its ambitious electrification targets for poor areas. Moreover, promotion of renewable energy in the Philippines is crucial to jointly address the global challenge of climate change. Job creation will target the poorest rural communities of Mindanao.
Bilateral EU-Philippines development cooperation is complemented by projects financed through regional and thematic programmes and instruments that are often implemented by civil society organisations addressing social issues, environment, indigenous peoples, human rights, peace building, and migration.
The EU is one of the most important donors to support the Philippines in cases of serious natural disasters which require emergency aid, such as after super-typhoon Haiyan which brought enormous support from the EU and its Member States.
Examples of EU-funded programmes
- Access to Sustainable Energy Programme ASEP was launched in 2016 and supports the Government in its efforts to increase access to electricity, integrate renewable energies on and off grid, and promote energy efficiency. Ensuring reliable and affordable access to energy is a key priority of the Philippine Development Plan (2017-2022) and Energy Plan (2016-2030), and, in addition to issues like health, education, rural development and gender equality, it is essential for the improvement of the welfare of the poor.
- Governance in Justice, GOJUST (2016-2020) supports the development and early implementation of a credible sector-wide long-term reform strategy for the justice sector in the Philippines.
- Health: EU support to the Philippines health sector reform agenda amounts to EUR 118 million (PHP 6.2 billion) over the period 2006-2018. Following two earlier programmes, the Philippine Health Sector Reform Contract represents the final EU sector budget support programme combined with Technical Assistance. The programme targets Universal Health Care and focuses on reforms addressing health financing, health service delivery, governance, and health human resources.
- The multi-donor Mindanao Trust Fund (MTF), administered by the World Bank, is the main mechanism of the EU to support long-term development in Mindanao. It assists in the socio-economic recovery of conflict-affected areas in the Bangsamoro core territories of Mindanao. The EU, together with Sweden, is the biggest contributor to the trust fund providing almost 80% (EUR 25.6 million or PHP 1.23 billion). The MTF is scheduled to run until 30 June 2018.
- The Trade Related Technical Assistance III project (2013-2017) has increased the capacity of government agencies and state actors to help the Philippines to better integrate into the international trading system. Since 25 December 2014, the Philippines enjoys enhanced trade preferences with the EU under the EU’s Generalised Scheme of Preferences plus (GSP+). Negotiations for an EU-Philippines Free Trade Agreement were launched on 22 December 2015.