III. MEASURES AND POLICY INSTRUMENTS USED FOR INTEGRATION
C. Other measures
1. Economic internal rate of return of public sector projects
Public sector projects (e.g., power, irrigation and road projects) play a key role in economic development, although the establishment and operation of such projects often result in adverse environmental consequences. In that regard, the Department of Environment and Natural Resources in coordination with NEDA, through its UNDP-assisted Integrated Environmental Management and Sustainable Development (IEMSD) project, recently commissioned a study and the design of a manual which provides a step-by-step approach on the economic valuation of environmental impacts. The manual was designed, in particular, to assist project analysts and decision makers in accounting for the environmental impact of projects and assessing the true net economic worth of a project within the context of sustainable development.
The manual, however, has yet to be adopted by ICC in its evaluation mechanism for ensuring that the environmental impact of public sector projects is taken into consideration in the approval decision of the committee, in addition to the current policy of requiring an ECC before a proposed project is finally approved. ICC policy towards the incorporation of environmental impact in the computation of the economic internal rate of return of public sector projects for national or foreign funding has yet to be drafted. Problems concerning valuation methodologies and the availability of data appear to be the major obstacles.