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Contracts Worth $1.7 Billion Awarded for ADB-Funded Malolos–Clark Railway Project

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The Malolos–Clark Railway Project, one of the government’s flagship infrastructure projects, will construct a safe, affordable, reliable, and environment-friendly railway connecting the northern provinces to the capital, Metro Manila. Photo courtesy of JICA.

Construction of the Malolos–Clark Railway Project, a flagship Philippine project funded by the Asian Development Bank (ADB), is expected to begin soon, following the signing of three civil works contracts worth more than $1.7 billion.

The signing ceremony today was hosted by the Philippines’ Department of Transportation (DOTr), which has so far awarded five civil works contracts for the project totaling $2.5 billion. The first two contracts were signed on 1 August 2020. The project, part of the government’s “Build, Build, Build” infrastructure program, will construct a safe, affordable, reliable, and environment-friendly elevated railway connecting the northern provinces and the capital, Metro Manila.

“This project is, by far, the ADB’s largest ever financing package for a single project, and is the single largest ‘Build, Build, Build’ project to date in the history of the Duterte administration,” said Department of Transportation Secretary Arthur Tugade. “Be assured that we are focused on our goal to make the Filipino life comfortable, the Filipino life convenient.”

“The signing of these contracts means the Malolos–Clark Railway Project construction will now go on full speed, helping the country’s economic revival over the next 12–24 months,” said ADB Director General for Southeast Asia Ramesh Subramaniam. “When completed by 2025 based on current plans, we expect the project to benefit nearly 350,000 commuters daily. We are proud to work with the Philippine government, development partners, and the private sector to deliver this important flagship infrastructure project using modern technology for the country.”

The Malolos–Clark Railway Project will cut the travel time between Clark in northern Pampanga province and Manila from two to three hours by bus to one hour by train, with a maximum rail speed of up to 160 kilometers (km) per hour. It will reduce greenhouse gas emissions by more than 60,000 tons annually and boost economic activity in regional growth centers like Clark.

The project is expected to create about 24,000 local construction jobs in the next three years. Once completed, the railway system will employ 1,400 people. The project will also spur larger, indirect employment and economic benefits to local businesses and raw material suppliers and manufacturers.

The project is part of the planned 163-km North–South Commuter Railway (NSCR) Project, which aims to reduce road congestion in Metro Manila and surrounding provinces. It will also help cut traffic-related economic costs, which total about $18 billion annually in Metro Manila alone. Once completed by 2040, the entire NSCR is expected to transport up to 1 million passengers daily.

The first contract package of the Malolos–Clark railway line—covering the construction of about 17 km of elevated rail viaduct, seven bridges, and two railway stations—was awarded to the joint venture of Hyundai Engineering & Construction Co., Ltd. and Dong-ah Geological Engineering Company Ltd., both based in the Republic of Korea, and the Philippines’ Megawide Construction Corporation.

Spain’s Acciona Construction Philippines, Inc. and Daelim Industrial Co., Ltd. won the second contract package, covering the building and civil engineering works for about 16 kms of viaducts and one railway station. The third contract package, for the building and civil engineering works for 12 kms of viaducts and two railway stations, was awarded to Italian–Thai Development Public Company Limited.

The other two contract packages were awarded in August to a joint venture of Acciona Construction Philippines, Inc. and EEI Corporation, and the Republic of Korea’s POSCO Engineering and Construction Co., Ltd. A sixth contract for the construction of the Blumentritt station of the railway line will undergo rebidding.

The project is cofinanced by the Japan International Cooperation Agency, which will provide up to $2 billion in additional funding for the rolling stock and railway systems.

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Financing to Support Liberia’s Reforms for Promoting Inclusive Economic Growth

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The World Bank Board has approved the third and last in a programmatic series of three Inclusive Development Policy Operations (IGDPO) designed to support key reforms that are critical to enabling inclusive growth. The financing, amounting to $55 million ($47.50 million International Development Association (IDA) concessional credit and $7.50 million IDA grant), will be disbursed as budget support. These reforms will remove distortions in key economic sectors, strengthen public-sector transparency, and promote economic and social inclusion.

The reforms supported in this programmatic series are aligned with the government’s objectives for improving access to quality agriculture seeds, clean and cheaper electricity, financial inclusion, access to social safety nets, and to other public services, especially for the poorest households, including refugees and refugee hosting communities.

We commend the Government of Liberia for successfully completing this programmatic reform series. The benefits of the reforms implemented are already becoming visible and include among others, the reduction in electricity tariffs and the cost of importing quality-verified solar products which will benefit many households in Liberia,” said Khwima Nthara, World Bank Liberia Country Manager.

This IGDPO builds upon the gains made under the first and second operations of this program approved in 2020 and 2021. The reforms supported by this operation will strengthen the regulatory environment to incentivize private-sector participation in the agriculture seed supply chain, through seed development, multiplication and certification. The actions supported under this operation will contribute to reducing commercial losses and strengthening Liberia Electricity Corporation’s (LEC) financial sustainability, as well as increasing access to solar energy. The previous operation supported the reduction of electricity tariff for poor households from US$0.385/kWh to US$0.22/kWh in May 2021, while this new operation further reduced the tariffs to US$0.15/kWh.

Numerous regulatory challenges that hindered the growth of digital financial services (DFS) have since been addressed by the Central Bank of Liberia (CBL), with active support from this budget support program along other World Bank Group  programs, resulting in Liberia’s National Financial Inclusion Strategy (NFIS) objective of increasing access to formal financial services to 50 percent by 2024 already being exceeded in 2021,” said Mamadou Ndione, World Bank Senior Economist and Task Team Leader of the IGDPO program.

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Global Recession Increasingly Likely as Cost of Living Soars

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The World Economic Forum’s Community of Chief Economists expect reduced growth, stubbornly high inflation and real wages to continue falling for the remainder of 2022 and 2023, with seven out of 10 considering a global recession to be at least somewhat likely. These are the key findings of the Forum’s quarterly Chief Economists Outlook, published today.


Prospects for the global economy have deteriorated further since the May 2022 edition of this report, with expectations for growth pared back across all regions. Almost nine out of 10 of the chief economists expect growth in Europe to be weak in 2023, while moderate growth is expected in the Middle East and North Africa (MENA) region, the US, South Asia and Latin America.


The grim outlook for growth is being driven in part by high inflation, which has triggered sharp monetary tightening across many economies. With the exception of China and the MENA region, most of the chief economists surveyed expect high inflation to persist for the remainder of 2022, with expectations somewhat moderating in 2023.

The cost of living crisis bites
As the high cost of living reverberates around the world, the chief economists are in agreement that wages will fail to keep pace with surging prices in 2022 and 2023, with nine in 10 expecting real wages to decline in low-income economies during that period, alongside 80% in high-income economies. With household purchasing power weakening, the majority of the chief economists expect poverty levels across low-income countries to increase, compared with 60% in high-income countries.


“Growing inequality between and within countries is the ongoing legacy of COVID, war and uncoordinated policy action. With inflation soaring and real wages falling, the global cost of living crisis is hitting the most vulnerable hardest. As policymakers aim to control inflation while minimizing the impact on growth, they will need to ensure specific support to those who need it most. The stakes could not be higher,” says Saadia Zahidi, Managing Director at the World Economic Forum.


The cost of living crisis is driving concerns around energy and food prices. The chief economists are particularly concerned in relation to sub-Saharan Africa and the MENA region, with 100% and 63% of respondents, respectively, expecting food insecurity, with a significant number of respondents also expecting food insecurity in South Asia and Central Asia (47%, both). Most concerningly, 79% of the respondents expect rising costs to trigger social unrest in low-income countries versus 20% in high-income economies.

Debt dynamics deteriorate
The chief economists almost unanimously agree that the risk of sovereign debt default in lower-income economies is increasing. This is in contrast with high-income economies where one in four flagged debt default as an increasing factor in 2022. But as interest rates continue to rise, 42% of respondents expect debt servicing costs to exert a significant drag on growth over the next three years versus 84% for low-income economies. In this context, about one-third of respondents said that high-income countries no longer have the fiscal space to deal with another macroeconomic shock, compared with three-quarters for low-income countries.

Global fragmentation deepens
Geopolitics is expected to dominate macroeconomic and financial developments in the years ahead, according to those surveyed. Almost nine out of 10 expect heightened geopolitical risk to have a significant impact on global economic activity over the next three years, and only slightly fewer (85%) expect business strategies to be similarly affected.


A significant proportion of the respondents (69%) also expect to see geopolitical tensions affect global financial markets over the three-year horizon. Most respondents expect fragmentation to increase, especially in technology (80% of respondents) and goods (70%), with a more moderate outlook for labour (60%), services (58%) and finance (52%).


Most of the chief economists expect businesses to take decisive action in response to global developments: 80% expect businesses to adapt their supply chains to geopolitical developments. Four out of five chief economists expect businesses to pursue supply chain diversification and localization (also 80%) over the next three years, with long-term implications for costs to consumers.

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Expansion of Social Protection Programs Necessary for a Resilient Recovery

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Universal Social Protection is critical to effectively protect people against poverty, prevent risks to their livelihoods and well-being, and help them access economic opportunities.  Achieving this goal will require social protection systems that are stronger, more resilient and better funded, according to a new World Bank report. While the pandemic, food and fuel price inflation, and longer-term challenges such as climate change make social protection critically important, they also threaten countries’ ability to raise spending and expand the social protection programs necessary for more resilient systems.

The new report, “Charting a Course Towards Universal Social Protection – Resilience, Equity, and Opportunity for All,” sets out a vision for achieving universal social protection. It underscores the need for countries to build integrated social protection systems that are underpinned by an increase in national spending to help expand social protection coverage, including to informal workers. To generate additional fiscal space, governments will need to reduce inefficient spending and mobilize more domestic revenues alongside continued international support.

“Social protection aims to promote investments in people and access to productive work, resilience to shocks and equality of opportunity,said Mamta Murthi, World Bank Vice President for Human Development.To reach universal social protection, governments will need to integrate services, such as social insurance, social assistance, and economic inclusion programs, ensuring all people are effectively protected throughout their lifecycle and across income levels.”

The report identifies five priorities for the World Bank to help developing countries further accelerate progress towards universal social protection. Climate change considerations and empowerment of women and girls are at the heart of these efforts. The five areas include:

  • Building strong foundational social protection systems.
  • Increasing coverage for social protection programs and promoting greater inclusion.
  • Building more resilient, adaptive, and dynamic programming.
  • Scaling up effective economic inclusion and labor systems.
  • Creating more fiscal space for universal social protection.

“In response to the multiple crises facing low- and middle- income countries, the World Bank is providing unprecedented support to help governments expand and improve social protection systems,” said Michal Rutkowski, Global Director for Social Protection and Jobs at the World Bank. This new report provides a vision towards the inclusive adoption of universal social protection to ensure that all people, including the poorest and most vulnerable populations, have the support they need and that no individuals or groups are left behind.”

Strengthening social protection systems is central to the World Bank’s mission to reduce poverty and promote shared prosperity. The COVID-19 pandemic proved to be a major catalyst for global efforts to scale up social protection systems. Between April 2020 and June 2022, the World Bank doubled its pre-COVID-19 social protection portfolio and provided more than $14 billion to 60 countries, including 16 countries affected by fragility and conflict, reaching more than one billion people worldwide. As of September 2022, the World Bank is providing $30 billion in financing to countries across regions and income levels. This includes $17 billion through IDA, the Bank’s fund for the world’s poorest countries.

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