Philippines
This profile summarises the Key Insights arising from the completion of the Readiness Assessment Methodology (RAM) for the Philippines, provides context through the Country Landscape.
The Philippines' Country Report are publicly available and can be downloaded below.
Key Insights
With its aspiration to join the ranks of upper middle-income economies, the Philippines is banking on the transformative benefits of Artificial Intelligence (AI). But in leaping into the AI revolution, the Philippines has yet to fully get its 鈥渉ouse in order鈥 to harness its true potential in AI adoption. Prevailing structural issues like poor digital infrastructure, siloed policymaking, bureaucratic inertia, lagging investments in national research and development, outdated legal and regulatory frameworks and guidelines, and fluctuating mobilization of public and private partnerships continue to undermine the Philippines鈥 velocity in the current scope and pace of digital transformation.
Fortunately, positive signs are on the horizon. The country鈥檚 lead AI policymaking bodies, namely, the Department of Trade and Industry (DTI), Department of Science and Technology (DOST), and the Department of Information and Communications Technology (DICT), vowed to accelerate the Philippines鈥 digital ambitions and address the emerging socio-economic and technological disruptions with the release of various AI national strategies, and roadmaps. The Department of Trade and Industry (DTI) launched the National AI Strategy Roadmap (NAISR) 2.0 in July 2024. NAISR 2.0 reflects the recent advancements in AI systems like generative AI (Gen AI), including the emerging debates and implications of ethics and governance. Similarly In June 2021, the Department of Science and Technology (DOST) rolled out its AI National Roadmap, noting its view on AI is deeply rooted from research and development mandate.
On governance, the Philippines has yet to enact legally binding rules and frameworks to regulate AI. Currently, various bills are currently pending in the Philippine Congress to ensuring the ethical and responsible adoption of AI through the establishment of Philippine Council on AI; and addressing AI鈥檚 impact to the manufacturing sector and the labor industry. A patchwork of existing laws, regulatory frameworks, and guidelines which span data privacy and security, innovation, freedom of information, and cybersecurity exist to address the prevailing regulatory gaps in AI policy and strategy. Several discussions with public and private sector experts and representatives reveal a 鈥渓ight touch鈥 approach presents the most feasible pathway for the country in managing the balance innovation-regulation to AI.
By 2028, the tech industry in the Philippines is expected to generate 1.1 million new jobs. In 2024, the Philippines鈥 AI market size was projected to reach US$772.10M. The market is expected to grow in the coming years at the rate of 28.57 percent, possibly reaching a market volume of US$3,4877.00M by 2030.
However, the lack of essential skilled labor can hamstring the country鈥檚 prospects. According to a UNESCAP study, almost 90 percent of the Filipino population lacks basic ICT skills such as word-processing, internet and email skills. Although upskilling and reskilling opportunities abound, many obstacles remain pervasive mainly due to the inadequate access to reliable and affordable internet access, and outdated educational curriculums at the primary and tertiary levels.
For instance, the Philippines has fixed broadband speed of 94.42 Mbps in Q2 2024鈥攁 figure lower compared to its ASEAN peers namely Singapore (284.93Mbps), Thailand (231.01 Mbps), Malaysia (132.72 Mbps) and Vietnam (135.00 Mbps. The World Bank claims that the root cause of the Philippines鈥 lagging internet connectivity lies on its prevailing market and regulatory failures characterized by the duopoly of two large telcos and the underinvestment in broadband infrastructures. Such current market environment discourages broad private sector participation and thus impact the successful implementation of the Philippines national broadband policy to narrow the digital underdevelopment.
With the rapid diffusion, adoption, and disruptive implications of AI systems in the country鈥檚 key sectors, capacity-building has become an urgent priority for the Philippine government. NAISR 2.0. has emphasized the need for rapid transformation of educational and training programs to nurture talents that can participate in AI productivity. Other legislative provisions include RA 11927, or the Philippine Digital Workforce Act calls for digital skills mapping, formulation of digital skills roadmap, and the development upskilling and reskilling programs. RA 119621 or the Trabaho Para sa Bayan (TBP) mandates the formulation of a plan to improve conditions for quality of employment and productivity, and establishment of labor market governance.
In April 2024, DICT partnered with the CSC to draft a Joint Memorandum Circular on the Principles and Guidelines for an Ethical and Trustworthy AI in the Government. To foster digital inclusion, the DICT launched the Universal Internet Subscription for Geographically Isolated and Disadvantaged Areas (UISGIDA) in Eastern Visayas. Similarly, the Department of Education and Commission on Higher Education are developing and implementing policies, and programs to revamp educational curriculums tailored to the emerging tech-driven economy, including an emphasis on the importance of ethical and responsible AI.
But given the seismic challenge of digital reskilling, several public-private partnership initiatives have begun to address the widening skill鈥檚 gap. A vibrant and entrepreneurial trifecta of industry-academia-civil society has emerged, advocating for structural and bureaucratic reforms, supporting and facilitating multisectoral and cross-sectoral discussions on AI policymaking, and even augmenting technical, legal, and policy capacity across the public and private sectors.
On the innovation front, the Philippine Government continues to underinvest in research and development (R&D). According to UNESCO Institute for Statistics, the Philippines鈥 Gross Expenditure on Research and Development as a share of its Gross Domestic Product is 0.32 in 2018. Due to insufficient funding support, the Philippines is underperforming in R&D, which consequently impact its AI research competitiveness.
Globally, the Philippines participates in various ongoing discussions on AI standards and policies. Through the Department of Trade and Industry- Bureau of Philippine Standards (DTI-BPS), the Philippines is a member to the International Organization for Standardization (ISO) and the International Electrotechnical Commission (IEC), and its technical committees, subcommittees, and working groups. DICT has also represented the Philippines in key international fora tackling AI governance such as the AI Seoul Summit and AI Safety Summit, and supports the adoption of the ASEAN AI Guidelines, and the OECD AI Principles.
The Philippines鈥 involvement to such international organizations and fora demonstrates its optimistic outlook towards championing a well-rounded and fit-for-context approach to AI policymaking. Although its AI journey is still a work-in-progress, the Philippines leverages such platforms to learn best practices, while contributing to international dialogues and networks on AI ethics, and standards.