The Asian Development Bank says the Philippines economy would benefit from greater cooperation between large corporations and smaller businesses, and from improvements to its infrastructure.

A new report released Wednesday by the Manila-based lender says the Philippines' private sector is constrained by a disconnect between large companies and domestic small and medium enterprises, many of which fail due to lack of capital, unreliable supply chains and weak demand for their output.

The report urges the government to lower the cost of doing business for micro, small and medium-sized enterprises by streamlining administrative procedures, passing anti-trust laws to create a fair competitive environment, and improving infrastructure.

The ADB says promoting public-private partnerships can improve the accessibility and quality of infrastructure.

The lender says PPPs have been typically ignored by business due to a cumbersome government approval process, a lack of bankable projects and controversial judicial decisions.

It calls on the government to encourage partnerships by making PPP project selection more transparent. It says the government should also provide better accounting of revenues and expenditures and mount a higher-profile anti-corruption drive.