But I don’t want to get lost in the nitpicking of what were or were not accomplished as against target. In the President’s second SONA, I think both her local and international audience would listen hard on how she proposes to move our country forward.
For instance, many would like to be assured that Filipinos have a surviving chance of having their crafted products patronized in the demanding domestic and global market. And that our continued adherence to WTO commitments will finally result in more economic benefits flowing to our hard-working kababayans, whether they are in the countryside or in urban centers.
While the Malacañang press machinery may brag that last year’s SONA has been the most applauded, having been interrupted 86 times due to clapping thus earning the honors of being three times more than the previous record, we must separate the bravado from the basics.
There were 55 "specific and time-bound" promises that the President outlined in her first SONA speech last July 23, 2001. Many were impressed with the "buckle-down-to-work" stance that the President took, and were just too relieved to leave the executive and legislative branches of government to map out their strategies to deliver positive results on their scorecards.
The recent economic outlook survey of the Makati Business Club (MBC) definitely comes in handy, although there are a few other things I’d like to add on to the list.
Again, the President and her administration may deserve some credit for the country’s stable currency that has hovered within the P50:$1 range for the past six months. It is quite clear, however, that the peso compared to other currencies like the Thai baht, was not able to fully benefit from the drop in value of the US dollar.
Interest rates have so far remained at its lowest in 10 years, but this does not seem to be generating the required responses from the banking sector and the investors. Structural reforms in the banking system and investment markets may be needed to motivate and encourage business activity.
I too share MBC’s concerns that investments would remain anemic as strategic investors continue to worry about the country’s peace and order situation.
After the neutralization of the Abu Sayyaf and three rounds of peace talks with the Moro Islamic Liberation Front (MILF), can the President assure that the Philippines is indeed back in business in terms of protecting its people?
Then there is politicking and corruption. This is a festering wound that gnats at any gain that the administration has made. When a foreign diplomat – the ambassador of the United States at that – tells us how corrupt the people in government are, and this is echoed by the common tao in informal surveys, there is something very wrong with our moral bearing.
Similarly, in the realm of politics, I couldn’t agree more with some of our good senators when they say that the impasse at the Upper Chamber shouldn’t be allowed to continue.
The recent Senate coup may turn out to be more expensive since it has held hostage several crucial economic and social reform bills such as the Special Purpose Asset Vehicle (SPAV) bill, the proposed Securitization Act, reforms to the Electric Power Industry Reform Act (EPIRA), Absentee Voting and Dual Citizenship bills, and almost a dozen others.
The impact of these bills can be far-reaching. For instance, how do we expect interest rates to remain low if banks’ non-performing assets continue to swell and remain indisposed? How do we promote the entry of fresh capital if investment alternatives such as securitization are not encouraged?
And should we ever expect our exports to be competitive if our power rates continue to be the second highest in Asia, right next after a highly industrialized nation such as Japan?
Much focus has been made on poverty alleviation, particularly in providing socialized housing to the urban and rural poor, micro-credit, employment and health benefits. Some notable achievements being touted by the administration to ease paucity are:
• About 180,000 households against the target of 150,000 provided with shelter.
• Over 312,000 women borrowers as against government’s target of 300,000 provided loans.
• Some 2.35 million urban poor enrolled under the National Health Insurance Program, or four times the target.
The above statistics look impressive but merely scratch the surface in the issue of poverty. A critical element is not being addressed, and this is the question of population policy. Foreign donors and creditors have warned that poverty alleviation would be difficult to achieve without controlling population growth. The government has to have a very clear policy on population recognizing that having more Filipinos with less means deeper poverty.
It is my only hope that these poverty alleviation measures would redound to overall economic recovery, more than encouraging a system of subsidy and a culture of dependency.
• The budget will be in deficit much earlier in the year due to poor revenue collections, and the government will be hard pressed not to borrow locally and overseas to fund the budget gap.
• Unemployment will remain a major concern at over 13 percent. This could trigger social unrests that could pose bigger problems with regards peace and order.
• Power rates will remain uncompetitive. This will keep the cost of doing business in the Philippines more expensive than in other parts of the region.
• Our trading partners such as Australia, the European Union and the US will continue to impose trade sanctions against the Philippines despite the WTO covenant, and sadly we may not be able to react more effectively.
Bottom line, all these depend on how one wants to see things. As the truism goes, the glass of water half-empty or half-full depending on what your agenda is. To the pessimists, this is certainly enough reason to justify joining that growing queue outside embassy gates or hiking to the boondocks. To the President and her Cabinet, however, this is definitely a signal to roll up the sleeves and buckle down to harder work.
Should you wish to share any insights, write me at Link Edge, 4th Floor, 15 Valero Street, Salcedo Village, 1227 Makati City. Or e-mail me at reygamboa@linkedge.biz. If you wish to view the previous columns, you may also visit my website at http://bizlinks.linkedge.biz.