PIDS Study Finds Varied AI Readiness Among Philippine LGUs, With Luzon Leading

Most Philippine local government units exhibit only low to moderate readiness for AI integration, according to a study published by the Philippine Institute for Development Studies in December 2025. ,” was headed by PIDS senior research fellow Francis Mark Quimba.

It assessed local governments using an AI Readiness Index that measured digital infrastructure, human capital, governance, innovation ecosystems, and economic foundations.

The index drew in part on the latest available data from a comprehensive survey conducted by the DICT in 2023. Most regions in Visayas and Mindanao recorded average AI-readiness scores in the low-to-mid 30s. More developed regions in Luzon, particularly NCR, posted higher scores.

The Bangsamoro Autonomous Region in Muslim Mindanao (BARMM), Eastern Visayas, the Cordillera Administrative Region, and Mimaropa registered some of the lowest readiness scores nationwide. Internet coverage stands as the most severe weakness across all island groups. Last-mile connectivity to actual barangays remains a significant gap.

Local governments across all income classes allocated small portions of their budgets to ICT development. The Konektadong Pinoy Act had its implementing rules and regulations finalized in November 2025. Rappler reported that the law seeks to address long-standing internet infrastructure shortfalls that the study identified as a critical bottleneck for AI deployment.

A PIDS webinar brought together researchers, labor specialists, and economists to examine these AI readiness gaps. Participants included Marvin Cabangunay of the Institute for Labor Studies at the Department of Labor and Employment, Professor Alexis Antoniades, Chair of International Economics at Georgetown University in Qatar, Dr.

Francis Mark Quimba of PIDS, and Chelsea Nicole Pineda, Senior Labor and Employment Officer at DOLE-ILS.

Quimba called for removing regulatory barriers to digital infrastructure development, including eliminating legislative franchise requirements for connectivity providers. He recommended updating outdated telecommunication laws such as RA 7925 and the Radio Control Law.

Quimba also recommended integrating AI and data literacy into the education system from K-12 to higher education and TESDA programs while investing in teacher training.

He proposed mandating minimum ICT budget allocations for local governments, starting at 2 percent of local budgets for digitalization and eventually increasing to 3 percent, with compliance tied to eligibility for national grants and performance-based transfers.

He further recommended establishing a national data governance framework under the Philippine Statistics Authority that includes standards for data collection, sharing, privacy, and a centralized portal. Quimba proposed creating a National LGU AI Readiness Fund to help poorer municipalities catch up in AI adoption and digital capacity.

During the same webinar, Professor Alexis Antoniades addressed the potential effect of AI on inequality. “We do have inequality rising and we see that if you look at the income distribution, the middle class starts to disappear. AI will only accelerate that,” Antoniades said.

Chelsea Nicole Pineda emphasized the enduring value of human qualities in an AI-driven labor market. “Nothing could really replace the soft skills,” she said. Pineda added that workers must cultivate “an attitude towards lifelong learning” because labor markets and technologies are changing rapidly.

Quimba highlighted the equalizing potential of schools. “Schools are actually the means for students who don’t have access to AI, to the tools, to be able to gain access,” he said. The study and webinar discussion took place against the backdrop of rapid global AI adoption that is reshaping workplaces, government services, and labor markets.

Rappler reported the findings on May 9, 2026 at 8:00 AM PHT.