Let me, first of all, thank the World Bank for this opportunity to speak to this joint session of the urban, water, and disaster risk management sectors of the Sustainable Development Network.
            As you and I are very much aware, this is no ordinary forum, given the extraordinary circumstances in which we find ourselves. Indeed, the survival of peoples and human settlements amid nature’s shortages as in droughts or nature’s excess as in floods is truly the proper focus of our sustainable development network week.
            The World Bank has been a long time partner of the Philippines in addressing the issues in these sectors, often introducing new thinking learned from years of experience in addressing global development concerns.
            The Bank’s new urban strategy is one such effort.
            Briefly, the strategy calls for embracing urbanization and managing it well, instead of preventing it. This perspective acknowledges many benefits of urbanization when fueled by fluid labor markets, converging production and consumption markets, productivity gains and market access.
            Urbanization has always been a challenge, especially for developing countries. With it come congestion, poverty, and crime, environmental pollution and climate change.
            The new World Bank strategy seeks the realignment of urban business and people business—putting people and poverty in the city’s top priority, rationalizing and stimulating the land and housing markets, and promoting urban environmental sustainability.
            The accompanying challenge, of course, is how this new way of thinking could influence the reformulation of national development policies.  In fact, the more serious question is whether it is implementable at all, considering the needed reforms, and change in the general behavior of the market, business, and government.

            By experience, I am optimistic it can be done.
            But let me first describe the Philippine landscape, so to speak, for urban development.
            The Philippines is one of the fastest urbanizing countries in East Asia.  It is projected that by 2030, 88 million of 114 million Filipinos or seventy-seven percent (77%) of the population will be residing in urban areas, largely driven by a strong rural-urban migration trend.
            Eighty percent (80%) of economic output and seventy percent (70%) of household expenditures are generated by Philippine cities today, making them certifiable “engines of growth”.
            Still there are critical issues that plague Philippine urban development: the un-competitiveness of Philippine cities, high poverty incidence, environmental degradation, and lack of urban housing and the proliferation of slums and informal settlers.
            There are clearly major constraints that prevent the Philippines from effectively managing urbanization.
            One, the lack of recognition of the urban challenge at the national level, and therefore, the lack of clear policies and action on urban development in general. 
            Apart from clear policy directions, cities and local governments need the tools with which to manage increasingly complex and dynamic urban systems. These include, among others: enabling legislation and regulations; modern and competitive institutions; innovative financing mechanisms; effective public private partnerships; and professionalized and effective urban planning/management and governance systems.
            Another key weakness in the housing and urban development sector is the gap between urban and regional development and housing policy formulation. Various agencies are tasked to address different aspects of housing and urban development, without coordination and integration. 

            Among the undesirable outcomes is inefficient delivery of basic services in the urban sector.  In the water utilities, for instance, some of the key issues are: the fragmented regulatory environment wherein various agencies have overlapping mandates; small water utilities unable to access private financing; the setting of tariffs to be able to recover cost at the local government level; and the critical need to find new water sources for Metro Manila.  
            Lastly, with development concentrated on economic progress alone, environmental and ecological considerations have taken the backseat.   As a result, the world’s and our country’s greatest setback now is coping with climate change in a much delayed catch up mode.
            This has never been more apparent than when the Philippines faced the most recent devastating typhoons, Ondoy and Pepeng, in 2009. The housing sector sustained the third highest disaster effect of typhoons Ondoy and Pepeng with some 220,000 homes completely or partially destroyed.  The degree of damage to the housing sector is estimated at us$ 541.6 million or 25.5 billion pesos and estimated losses of us$ 188.8 million or 8.9 billion. Clearly, the informal sector with its make shift dwellings in flood prone areas bore the brunt of the damage.
            Despite the foregoing, there have been local governments that were able to overcome the challenges and emerge as model local governments for sustainable urban development and management.
            I am proud of the fact that one such city in the Philippines is Makati, the premier financial district.  Let me share with you the Makati story with insights on what could work.
            When I first became its mayor, twenty five years ago, Makati was a city that crisis built. For a long time, even if it was the country’s financial center, it was stagnating in social services; the municipal government was badly hobbled in collecting taxes; and it was bankrupt.
            Now, Makati is the country’s richest local government unit on a per capita basis. It has a dynamic local economy. It is known and envied for its superior and modern public infrastructure and exemplary social programs and services - enjoyed by the residents regardless of economic status. The poor are no longer underprivileged as they now have an equal chance of getting quality education, health and employment opportunities. And most meaningful for us in this forum, the city, through all the years of its transformation, has sustained a livable ecological environment.
            How did we get where we are right now?
            As I look back I can identify four of what I’d like to call turn-around factors.
            First, good governance simply meant, at that time, setting things straight. We adopted fiscal discipline, streamlined our revenue collection, purged the payroll of thousands of ghost employees and cancelled many contracts that were clearly disadvantageous to the local government.
            We reached out to the business leaders and told them that we will not interfere in business but will focus on running government and its services.
            It was this culture of trust between the city government and its citizens that helped Makati enjoy and higher and more sustainable level of growth.
            Second, we embraced subsidiarity or what I all closer to the people principle. We were convinced that any government function is best performed by the subsidiary of government that is most competent and closest to the people.
            The city entered into strong, pro-active, and committed partnerships across all sectors and created special bodies for specific concerns such as business promotion, health, environment, and public safety among others. We opened a variety of communication channels to interact with the public and learn about their concerns and solicit their inputs.
            We believe that “it is people that make the economy work.” We treated them all as important stakeholders in determining the city’s future.  We did this from the private business sector down to the smallest government unit, known as the barangay.
            Third, our social development strategies concentrated on education, health, and housing. We aligned the city’s educational system with the human resource needs of the Makati business community.
            We improved universal access to our health programs, emphasizing preventive health care and healthy lifestyle.  And we provided affordable housing in the less developed and low-income areas. This we did through the first local government rental housing program and a public-private partnership to relocate Makati’s informal settlers in self-sufficient, sustainable communities.
            To support the focus on health, education and housing, the city government also embarked on the improvement and renewal of public infrastructure and facilities; and reformed the city’s regulatory and governance framework to create the necessary climate conducive to business expansion and retention.
            Fourth, we focused on the city’s sustainability including, among others, the crafting of a risk sensitive urban redevelopment plan to make homes safer, improve traffic circulation and access to emergency vehicles, generate more open spaces for recreation and potential evacuation, and enhance the capability of the community to prepare for and respond to disaster.
            With the goal of attaining a sustained liveable ecological environment, we have undertaken massive promotion of energy-efficient technologies through various projects ranging from the introduction of an electric vehicle (called the B-jeep), that plies along the Makati green route, to green procurement processes, energy efficient street-lighting and “green loop” waste management.
            Now where have these turn-around strategies brought us? At the very least, recognition of what can be done given sufficient political will; at the most meaningful, becoming an example for other local governments to emulate.
            The World Bank has dubbed Makati as one of East Asia’s “Climate Resilient Cities” in 2008.
            From the non-government side, Greenpeace has also selected Makati for promoting energy-efficient technologies.
            At the same time, the city was among the recipients of technical assistance from the cities alliance/World Bank and other development partners for the city development strategy project. This is an enabling platform for good governance and improving service delivery.
            At its conclusion, the Makati story tells and reaffirms to us the principles we lived and worked by as we brought it back to life and nurtured it to its present stature. These are the principles of liveability, bankability, competitiveness, and good governance.
            Even as I have moved to the next level in my public service life, I find, I am again thrust into the same development context that faced me as the mayor of Makati.  Having been appointed head all of the national government agencies in charge of housing and urban development, I face the same constraints as before although on a much larger scale.
            As head of the Housing And Urban Development Coordinating Council (HUDCC), my team and I must use all our learnings from the Makati experience and ramp them up to a national scale.
            We must integrate sustainable practices and principles of good governance with national and local development plans.
            We are looking at incorporating these approaches and principles in the execution of our national plans such as the Medium Term-Philippine Development Plan for the year 2011 to 2016, which is currently being drafted, and the existing national urban development and housing framework. 
            This framework is anchored on providing families not just with the infrastructure of a house, but the framework of a home; to build not just a neighborhood, but a real harmonious community.
            We must ensure that the planning is people-centered so that no one is left behind. We must reach out and talk to the grass roots as well as build the capabilities of those closer to them, the LGUs.
            We cannot do it alone. We need the support of multilateral institutions such as the World Bank that have made managing global urban development as their business.  The Philippines and the World Bank have been long-time partners in programs and initiatives that aim to reduce poverty and improve the quality and impact of urban development.
            The Philippine Urban Consortium (PUC) is one such initiative.  It will be a platform for constructive dialogue among stakeholders to: articulate and prioritize key urban issues and action plans; provide opportunities for knowledge sharing on global trends and cutting‐edge knowledge; and facilitate capacity building for stakeholders in addressing critical urban issues. 
            Both World Bank and the Philippine national government are pushing for urban competitiveness and sustainable communities.
            Private sector-led initiatives will be encouraged to develop large available land for new communities, communities that are, eco-friendly and socially and economically reliant. We enjoin the active participation of our friends from the World Bank as we create new sustainable communities or town sites to disperse the concentration of people in the urban areas.
            Coming on the heels of the successful privatization of manila water, we are structuring a Public Private Partnership Program (PPP), particularly in big ticket projects such as in the North Triangle Development and other urban development projects.  Private sector partners need to get reasonable rates of return from their contributions to the projects while optimizing risk allocation between parties, minimizing costs, and realizing project objectives.
            We hope that World Bank will continue to support our poverty reduction and urban renewal efforts such as in pursuing more sustainable land use policies in areas of moderate to high density urban land use, and in urban regeneration and Brownfield development.
            We would like to expand our collaboration in building and disseminating local and international sound practices on disaster risk management, climate change mitigation and adaptation; in adaptive capability building.
            We also would like to seek the world bank’s support in the mobilization of greater and more diverse and sustainable sources of financing that would help governments adapt and implement programs for climate change mitigation, adaptation, and disaster risk reduction; and provision of much needed funds and risk transfer mechanisms directly accessible by local governments.
            It has been said that humankind will not solve the problems it faces today with the same values and approaches that created them.
            Therefore, for us in the Philippines, it will not be business as usual in the housing and urban development sector.
            What we are gearing for is a paradigm shift, setting ambitious targets that would require us to think deeper, perhaps even sideways, as we cast new eyes on our goals for housing and urban development.
            And with the World Bank among our steadfast and stimulating development partners, we know we will not be alone.  Instead we will be full of knowledge and purpose to achieve our common visions of economic ecological sustainability, human compassion, and social transformation.  Let these fruits flourish from our partnership.  May they be reaped by those who seek to escape poverty through the promise of a new wave of urbanization.

            Thank you.​