WB approves $600-M loan for Philippine education project

By Justine Irish D. Tabile, Senior Reporter

THE World Bank (WB) said that it approved a $600-million loan to improve learning outcomes in Philippine primary and lower secondary education.

In a statement on Monday, the World Bank said the loan will finance the Project for Learning Upgrade Support and Decentralization (PLUS-D) which aims to improve foundational literacy, numeracy and mathematics outcomes.

The loan will finance grants and tailored support for 10 selected Department of Education (DepEd) regional offices and over 11,100 schools, benefiting more than 21 million K-10 students and 770,000 teachers.

“For the Philippines, sustaining growth and creating more jobs will depend on strong human capital — a workforce with solid foundational skills in literacy and numeracy,” according to Zafer Mustafaoğlu, division director for the Philippines, Malaysia, and Brunei at the World Bank.

“This effort is about giving every Filipino child a fair start, ensuring they can build the skills that underpin lifelong learning and future success in the labor market,” it added.

According to the bank, the Philippines faces a severe learning crisis in basic education, exacerbated by the COVID-19 pandemic, with recent studies showing that 91% of 10-year-olds are unable to read and understand an age-appropriate text.

“Low learning outcomes are closely linked to inadequate teaching and learning conditions, including limited teacher capacity, suboptimal school leadership, insufficient infrastructure, and subpar quantity and quality of learning materials,” the World Bank said.

PLUS-D aims to address these challenges through delivering nationwide support to help K-10 learners catch up and excel by focusing on foundational literacy and numeracy improvement.

“It will support DepEd’s learning acceleration and recovery program, while improving how learning is measured and used in classrooms through enhanced assessments,” it said.

The program will also strengthen teaching and leadership through evidence-based training and coaching, making inclusive teaching-learning materials accessible, and advancing DepEd’s digitalization and decentralization programs.

“PLUS-D is about combating learning poverty nationwide by equipping teachers with evidence-based support, promoting school autonomy and accountability, and helping Filipino learners become independent, confident readers,” World Bank Senior Education Specialist and Project Leader Janssen Edelweiss Teixeira said.

“We have seen this work in countries around the world, and the Philippines will be no exception. Help is on the way,” he added.

In a separate statement, the World Bank said that it expects Philippine inflation to intensify further due to the war in the Middle East.

“Price pressures increased in February and are likely to intensify further. Inflation accelerated to 2.4%, driven by higher prices of food, utilities, and restaurant services,” it said.

February inflation is still within the 2-4% target of the Bangko Sentral ng Pilipinas (BSP).

Although the BSP held policy rates steady in an off-cycle meeting on March 26, it said that it could shift to monetary policy tightening if oil price shocks threaten to un-anchor inflation expectations.

It said the conflict also poses a negative terms-of-trade shock for the Philippines as the country heavily relies on imported oil and fertilizer shipments transiting the Strait of Hormuz.

“Depending on the extent of disruption, reduced supply and higher prices will weigh on growth and increase inflation,” it said.

In particular, it said every 10% rise in international oil prices could raise headline inflation by up to 0.5 percentage points.

“Brent crude prices have risen by 42.5% between Feb. 27-March 23. If oil prices remain 60% above the 2025 average, nominal household incomes could fall by 3.3%,” it added.

The government has declared a one-year state of national energy emergency to create freedom of action to deal with the impact of the conflict, including giving President Ferdinand R. Marcos, Jr. the power to reduce fuel excise taxes.

According to the World Bank, if the excise taxes on fuel are suspended through 2026, it will result in foregone revenue equivalent to over 0.5% of gross domestic product.

The World Bank said it will be watching out for the pass-through impact of the oil price shock on domestic inflation and further policy responses to the Iran crisis.