Internet connectivity in the Philippines lags behind the Asean countries in affordability, speed, and access, creating an uneven landscape for digital participation, according to a World Bank policy report.
The report noted that limited Internet access curbs digital potential for citizens and businesses, with peri-urban connectivity being critical to future growth.
“The country’s poor broadband infrastructure is rooted in outdated policy frameworks that stifle investment in rural areas and foster a market with weak competition, both of which hinder broadband expansion,” the study observed.
The report said that binding constraints underlying the Philippines’ poor broadband infrastructure are interrelated, requiring a comprehensive package of reforms to yield desired entry, investment, and sector performance outcomes.
“The Open Access in Data Transmission (OADT) bill is a promising, viable start, among several proposals in Congress,” the report noted.
The report said that policymakers can build on immediate reforms through the Open Access Bill as an entry point to broader and medium- to longer-term digital connectivity agenda.
“The cost of inaction — loss of growth opportunities, people remaining unequipped for future jobs, and widening of the digital divide — is too high for the Philippines,” it added.
The report also noted that the digital divide in the Philippines is rapidly expanding. From 2019 to 2022, access gaps between the rich and the poor expanded by far the fastest for broadband Internet, compared to public and private services, utilities, and household goods.
“If the pattern remains unchanged, this gap will grow wider, making the digital divide the determinant of broader inequity in access to opportunities, leaving most of the poor behind,” it said.
The World Bank warned that the government’s key development priorities will be jeopardized if poor broadband access is not addressed.
“The price of fixed broadband, essential for productivity — work, learning, micro, small, and medium enterprises’ participation in the digital economy — is 11 percent of gross national income (GNI) per capita, more than four times higher than Malaysia and Vietnam and two times higher than the Asean average,” the study said.
“The cost of fixed broadband converted to absolute US dollar price is the highest in the Asean. Philippine household penetration of fixed broadband in 2022 was 33 percent, much lower compared to 50 percent in Malaysia, 58 percent in Thailand, and 76 percent in Vietnam.”
“For mobile broadband — considered the driver of consumer adoption of e-commerce, financial inclusion, disaster response, and agriculture practices — active subscribers in 2022 were 70 per 100 inhabitants, the lowest among large Asean economies,” it said.
The Philippines is estimated to represent more than 50 percent of the Asean population unconnected to mobile broadband. The cost of a mobile broadband basket was 2 percent of GNI per capita, 1.5 times higher than the Asean average, the report added.
