Perspectives in Development Finance and Overseas Development Assistance (ODA) in the Philippines

This paper reviews development finance and ODA in the Philippines, amidst current trends and historical flow, as well as reveals similarities and differences with the ODA trends of one of its closest neighbors, Indonesia, to determine whether either country, is moving towards casting off its ODA recipient status. Findings reveal an uptrend in global ODA, with trends in the Philippines ODA and other overseas capital flow, appearing to mimic the world economy. Downward ODA trends in the Philippines were evident, during international financial crises and presidencies, marked by corruption. Total ODA commitments in the Philippines reveal a converging trend with the public sector, as the main ODA channel, and this was the major ODA channel for Indonesia as well. Bilateral ODA commitments surged in 2012, with Japan emerging as the top donor for both the Philippines and Indonesia. The Philippines’ major multilateral ODA donor was the European Union (EU); however, other multilateral institutions were Indonesia’s top multilateral donors. In terms of total aggregate ODA, major bilateral donor countries of the Philippines included Japan, the U.S., Australia, Korea, Germany, and France. This was the case also in Indonesia, except that Korea did not figure in its top five list. Furthermore, a jump in ODA value was observed in the Philippines and Indonesia ODA trends, after an environmental disaster hit these countries, on two separate occasions. Thus, while many similarities were found in terms of ODA trends in the Philippines and Indonesia, the Philippines remains a net recipient of ODA, while Indonesia is emerging as a donor country, as seen in the steady decline of its multilateral ODA, received during the past few years.