Philippines Smart Cities

The Philippines is at a pivotal moment in its urban development journey. By 2050, it is projected that nearly 102 million Filipinos will reside in cities—almost twice the number today. The emergence of smart city solutions offers a positive outlook for a more advanced urban future in the Philippines.

According to the World Bank, a “smart city” in the Philippine context refers to an innovative urban area that leverages technology and innovation to improve functionality, sustainability, and livability. The goal is to create cities that are more responsive to the needs of not only their residents but also the environment. Prime examples of smart cities in the Philippines are Manila, Cebu, Davao, and Clark. Local Government Units (LGUs) that have initiated steps to become smart communities are Malabon City, Mandaue City, San Fernando City, Pampanga, Tagum City, Cauayan City, and Tuguegarao City.

There are several opportunities for U.S. firms in various sectors, especially in ICT and digital connectivity, energy, smart infrastructure, and smart transportation.

Some of these key opportunities are presented by major initiatives by the Philippine government such as the Build Better More program, which builds on the previous administration’s Build! Build! Build! Initiative.  This program focuses on enhancing the country’s infrastructure. Out of 185 infrastructure projects under the $165 billion program, 134 projects, or 83% are aimed at improving physical connectivity. These include expressways and farm-to-market roads.

For 2024, $26 billion of the $100 billion national budget is allocated to infrastructure, representing 5.7% of GDP. The Marcos administration is committed to maintaining infrastructure spending at 5 to 6% of GDP and is increasing the use of Public-Private Partnerships (PPPs) to support these projects.

Another major government thrust is the digital transformation journey of the Philippines. President Marcos recently approved the Philippine Digital Infrastructure Project worth $288 million which is intended to boost broadband connectivity nationwide, especially in remote areas.

A key part of the government’s strategy to address Metro Manila’s urban pressures has been to push growth and development outwards. With space limited in traditional business districts, new development is now being targeted in other regions. Hence the rise of mixed-use projects and township developments – —providing areas and amenities for home, work, and play for residents.  These efforts are mostly driven by the private sector, largely due to increased Business Process Outsourcing (BPO) investments.  

U.S. exporters involved in smart cities development are highly encouraged to apply for the U.S. Department of Commerce executive-led Innovative Technologies for Urban Infrastructure Development Mission to the Philippines and Indonesia on November 12 to 20, 2024. The mission aims to foster collaboration and knowledge exchange between U.S. exporters and local stakeholders in smart city development, digital ecosystems, and sustainable urban infrastructure. It is expected to provide U.S. exporters with a comprehensive understanding of the urban infrastructure landscape in the Philippines and Indonesia, fostering collaboration, innovation, and sustainable development opportunities.

For more information, contact Easter Villanueva of U.S. Commercial Service Philippines at Easter.Villanueva@trade.gov.