GMA must act to support recovery

The expat business community in Southeast Asia has singled out the Philippines and Indonesia as having a pattern of worsening bureaucracy. A survey confirmed what we have known for ages, simply that the human and regulatory dimensions of our bureaucracy posed major frustrations for investors and ordinary citizens alike.

In fact, President GMA is keenly aware of this and if I remember right, reforming the bureaucracy and streamlining bureaucracy’s procedures are all part of her promised program of government. Improving transparency in government is essential in minimizing corruption. Businessmen (and again, ordinary citizens) dislike systems where there are so many rules that it is difficult to know what is possible and what is not and decisions are open to interpretation by different authorities, as the survey puts it.

Then again, I suspect that the resolve of the administration and its civil society supporters to work for greater transparency ended when they found out that having the inside track can be profitable. Successfully navigating the bureaucracy earned the civil society gang over a billion pesos overnight without investing a single centavo. But that is another story.

There are other things crying out for attention. President GMA must also know that rice smuggling continues unabated, to the point that bodegas are still overflowing with rice even now, supposedly the lean season. No official rice imports may be needed anymore because the smugglers have done all the importing already.

This means, government has failed to improve the productivity of local rice farmers. The fact that smugglers can buy rice abroad, smuggle that here and still make a bundle shows that our production costs are so high to be uncompetitive. That means, the poor farmer isn’t going to make money and the ability of the agricultural sector to lead the economic rebound may be at serious risk. Of course, the smugglers don’t pay port charges.

This brings us to still another serious problem I have heard a lot about lately. The high cost of transporting products from one part of the country to another continues to hobble regional economic development. The domestic shipping cartel continues to charge rates that make it cheaper to ship from Los Angeles to Manila than from General Santos to Manila.

As if that is not enough to punish agricultural and industrial producers from Visayas and Mindanao, the government through the Philippine Ports Authority has authorized private operators to increase port charges. The PPA gets a percentage of the increased charges, making government a partner in crime. That’s definitely a disincentive to the sectors of the economy we need to spearhead our economic recovery. This is another reason for the Commission on Appointments to hold the confirmation of the DOTC secretary.

Surely President GMA is not unaware of these dangers to her program of government. Unless she acts positively and decisively, the economic takeoff will be aborted. I can understand the political considerations she must make but she should remember that if the country goes nowhere, she might as well kiss 2004 goodbye.

Actually, I suspect that the reason why her so-called political allies are trying to get everything they can get from her this early is because they have given her up for 2004. For her own self preservation, she must now make sure that reforms are instituted now. As it is, everyone around her is featherbedding at her expense. And I might add, at the country’s expense too.

ADB representative

What is this I hear that President GMA has decided to quiet down the criticisms from FVR’s camp by agreeing to appoint one of FVR’s daughters to take the board seat at the ADB we share with Pakistan? Ang kapal naman! That political accommodation means Dondon Paderanga who now holds that seat must be fired so that the relatively inexperienced former president’s daughter can take it. That’s why Dondon was recently named to the UCPB board instead.

This is too much. That ADB seat should not be a political largesse to be freely bestowed without due regard to the national interest. Clearly, Dondon is light years more qualified than FVR’s daughter. Dondon was a former member of the Monetary Board, a former head of the NEDA and a prominent and respected economist with more than adequate academic credentials. That position needs stature.

In contrast, what has FVR’s daughter done other than be identified with a securities firm that didn’t do that well? That ADB board seat is important to the country and must be held by someone who has a better understanding of the country’s economic situation and developmental needs. She may be good in the area of capital markets or investment banking but not ripe enough for that ADB posting.

I thought FVR was different. He was so eager trying to get himself a good page in history, and he might have succeeded. But the good image he created for himself during his term is starting to crumble with his post tenure behavior. It is bad enough he left us his legacy of Aniano Desierto, now this appointment of his daughter.

I hope the rumor is not true. Or if it is, that FVR and GMA will get back to their senses and stop this clearly political appointment. Just because Ronnie Zamora did the same thing by causing the appointment of his daughter to that ADB post does not mean GMA must be as crass as to do the same with FVR’s daughter. They’d be laughing at us again at ADB as they did with Ronnie’s daughter. We have the best man right now holding the position. Let us keep it that way.

CalPERS

I heard that the real reason CalPERS (the pension fund that withdrew its investments from ASEAN last week) is pulling out is because they really lost a bundle in the region in a series of bad investments. In the Philippines, they lost big in that scandal of a failure at All Asia. That’s the high flying group that got even the International Finance Corp. (IFC), the World Bank subsidiary, in a deep hole.

The IFC accused All Asia management of rather serious charges but somehow, the All Asia failure didn’t attract the kind of media attention that Urban Bank did. Maybe that’s because like Enron, All Asia’s activities were incomprehensible to all but a bunch of investment bankers or maybe they just made it seem such. At least, the victims of All Asia are well positioned to take their losses. No ordinary Juans got burned.

Next time you get an offer too good to be true, it often is – unless Code NGO is behind it.

Favorite animals

A reader sent this one in.

What are a woman’s favorite animals?

A mink in the closet; A Jaguar in the garage; A tiger in the bedroom; and an ass to pay for it all!

(Boo Chanco’s e-mail address is [email protected])