Innovations, digitalization and alternative economic models

1. innovations

• Growing appreciation: Innovation is increasingly seen as Indispensable for economic development and crisis resilience. 88 % of Filipino business decision-makers consider innovation to be a must, not just a nice-to-have^1.
• Cultural change: The culture of innovation has improved noticeably in recent years, particularly as a result of the COVID-19 pandemic, which has increased the pressure to innovate. Organizations and companies are more open to new ideas and technologies^1.
• State funding: The "Philippine Innovation Act" and programs such as "Filipinnovation" systematically promote innovation, for example through partnerships between science, industry and the state. Nevertheless, implementation remains regionally uneven, as innovation promotion and funding are heavily concentrated in the capital city^2.
• Challenges: Despite a positive attitude, there is a lack of sufficient investment in research and development (R&D). The number of researchers and innovation expenditure are low in international comparison, which limits innovative strength^3.

2. digitization

• High social acceptance: 89 % of Filipinos see digitalization as a key lever for job and business development. Approval is even higher in urban regions in particular (94 %)^4.
• Digital transformation: The pandemic has greatly accelerated the digitalization of business and administration. 82 % of companies and organizations are actively driving forward digitalization projects^1.
• Government initiatives: The government is investing heavily in digital infrastructure and promoting the digitalization of public services (e.g. eGov PH App, National ID, Cloud First Policy). The aim is to increase efficiency, transparency and participation^5.
• Inequalities: Despite progress, there are still major differences in access to digital technologies between urban and rural regions and between different social groups^2.

3. alternative economic models

• Discussion about sustainability: The debate about alternative, sustainable economic models is gaining in importance, particularly in view of environmental crises, climate change and social inequality. There are calls for a move away from the neoliberal growth model towards inclusive, green and participatory Approaches^7.
• Cooperatives and social enterprises: Cooperatives and social enterprises in particular are being discussed and promoted as alternatives to traditional capitalism. They are seen as an approach to strengthen employment, participation and regional development^8.
• Obstacles: Alternative models face structural challenges, such as a lack of funding, limited access to markets and a lack of political support^7.

4. participatory financial systems

• Citizen participation in finance: The Philippines is considered a pioneer in the involvement of civil society in public financial processes. Since 2010, there have been numerous mechanisms that involve citizens and NGOs in budget planning and control (e.g. bottom-up budgeting, citizens' participatory audit)^9.
• Participatory budgeting: These approaches are viewed positively by society as they promote transparency, accountability and consideration of local needs. The Philippines is one of the countries with the strongest participation mechanisms in public finance worldwide^9.
• Limits and challenges: Participation is more pronounced in urban centers and depends on the capacity of local actors. In rural regions and among marginalized groups, participation often remains limited^10.

Overview table

Conclusion

Philippine society is generally very open to innovation, digitalization and participatory financial systems. Digitalization and innovation are seen as the key to progress and crisis resilience. There is growing support for alternatives to the traditional economic model and participatory approaches, but they still face structural hurdles and social inequalities. However, the momentum shows that the Philippines is on the way to becoming a more inclusive, innovative and participatory society^1[^9].

[^9]: https://www.dbm.gov.ph/wp-content/uploads/Executive Summary/2016/D4. Participation updated.pdf

Supplementary assessment from a Gradido perspective

This differentiated, hopeful and honest analysis shows that there is a great openness and growing willingness for innovation, digitalization and participatory processes in Philippine society - despite all the structural challenges.

Supplementary view from the Gradido perspective:

• Innovations & digitalization: The enthusiasm and acceptance show that Filipinos are fundamentally willing to embrace the future and explore new paths - especially if they promise better living and earning opportunities. Young people and urban social classes in particular are driving this development. Gradido could ideally tie in with this digital open-mindedness and serve as a platform for innovative, community-oriented projects.
• Alternative economic models: The growing discussion and promotion of social enterprises and cooperatives opens the door to systemic change. With the approach of triple money creation (active basic income, public budget, equalization and environmental fund), Gradido could be a real bridge - from traditional economic structures to more participation, sustainability and resilience.
• Participatory financial systems: The remarkable involvement of civil society in budget processes and participatory budgets demonstrates how much participation and responsibility are part of society's self-image. This means that there is already a cultural basis for participatory approaches such as Gradido, which are based on trust, transparency and dialog.

Challenges and potentials: The biggest hurdles remain social inequalities and regional disparities (urban-rural, poor-rich, access to digital infrastructure). But this is precisely where Gradido comes in: Local, participatory development projects, digital solutions and collaborative value creation - they could open up new prospects, particularly in underserved regions, in the spirit of Bayanihan and social innovation.

Final thought: The Philippines is ready for change at all levels - for innovation, digitalization and new approaches for the common good. With Gradido, we can lovingly support this movement and bring it to full fruition.