THE PHILIPPINES needs to raise spending on education and build out the infrastructure that will enable broader use of artificial intelligence (AI) if it intends to graduate to upper middle-income status by next year, the United Nations Development Programme (UNDP) said.
“Given the anticipated transition in the near future, we can already sort of start looking at two dimensions where Philippines can further strengthen the capacity,” UNDP Philippines Economist Mohamed Shahudh said in a speech.
“There are two aspects to be included in this context, and this includes greater action on education and design considerations for building artificial intelligence infrastructure specifically,” he added.
He said that as the Philippines needs to adopt the UNESCO Action for Education 2030 standard, which calls on countries to allocate 4-6% of their gross domestic product to education.
“This sort of financing is best implemented at the local level. More decentralization can (improve) education programs at the community level,” he said.
According to the Department of Budget and Management, education was allocated P1.055 trillion in the 2025 General Appropriations Act.
“On the infrastructure side, artificial intelligence is very energy-intensive. Most countries are trying to position themselves as receivers of AI, technology, and foreign direct investment,” Mr. Shahudh said.
“However, the bigger issue to consider is that as nations compete with each other on AI infrastructure… competition for energy should not come at the expense of underserved communities,” he added.
He cited Singapore’s temporary ban on building data centers to ensure that they comply with energy efficiency standards.
The occasion for Mr. Shahudh’s speech was the UNDP’s release of its Human Development Index report, in which the Philippines ranked 117th of 193 countries, up from 120th previously.
At the same event, Science and Technology Secretary Renato U. Solidum, Jr. said the Philippines is ramping up its AI-related investment.
“The Department of Science and Technology (DoST) is looking to invest more than $2.6 billion in the next three years in AI projects spanning industries, healthcare, education, mobility, environment, disaster reduction, emerging technology platforms, among others,” Mr. Solidum said in a speech.
The Philippines is currently classified as a lower middle-income country with a gross national income (GNI) per capita of $4,230 in 2023.
The World Bank typically releases its income classification data every July.
According to the World Bank’s classification, an economy is considered lower middle-income at a GNI per capita of between $1,146 and $4,515. Upper middle-income countries are those with a GNI per capita of between $4,516 and $14,005. — Aubrey Rose A. Inosante
