MANILA, Philippines - President Aquino highlighted yesterday the country’s rise to investment-grade status as he also bared the government’s medium and long term plans to attract more businesses to set up shop here.
Speaking at the Euromoney Philippines Investment Forum in Pasay City, Aquino said the economy performed in a stellar manner and despite the disasters that befell the country in 2013, the Philippines still posted one of the fastest growth rates in Asia at 7.2 percent.
“As our people continue to rewrite the story of the Philippines – from the apathy of the past to the dynamism of the present, from our previous fumbles to the firm resolve that is propelling us towards a more promising future – I invite all of you to take a larger role here – to be present as our people pursue the permanence of our prosperity, on the road to becoming an economy and a country greater than ever before, he said.
“But as we talk about the performance of our reforms, I also feel compelled to add: As much as we measure the confidence of investors in our country in fundamentals and policies, as a public servant, I must point out that there is another factor we must pay attention to. It is the self-esteem and morale of our citizenry. Not long ago, our people had very low expectations of their country, their government, and even themselves. Over the past three and a half years, however, we have shown them what it feels like to have a government that actually works for them-a government that does not break past promises, and in fact, under-promises, and over-delivers,†Aquino said.
The President cited an example in the Department of Education, which he said managed to address the backlog in classrooms and built 66,813 rather than just the original target of 66,800 when they thought the government could only afford to fund only 48,000 in six years or 8,000 each year.
“It goes without saying that this has had a tremendously positive effect on our national psyche: The Filipino has recovered his pride, and has become even more determined to exhibit his full potential to the entire world,†Aquino said.
According to Aquino, this is perhaps the single greatest guarantee that reforms will outlast their term in office and even their lifetimes.
Based on population projections by the United Nations, the Philippines will hit a “demographic sweet spot†starting in 2015. In simple terms, this means that a large portion of the people will be hitting working age and on average, hitting such a sweet spot has led to a 10-year period of 7.3 percent yearly growth, Aquino said.
“So one can only imagine the possibilities for us, considering our workers are renowned for their resilience, creativity and loyalty. As we hit this sweet spot, it becomes even more vital: We must cement the reforms we have made, and make certain that we extend our aim of uninterrupted growth-from years, to decades, and hopefully, even to generations,†Aquino said.
Since disasters like Super Typhoon Yolanda can negate gains and even push back development, Aquino said the administration’s good governance efforts equipped them with the resources to take care of the people and build back better. He said continuing rehabilitation efforts was the number one priority and genuine recovery in more disaster-resilient communities.
He said the damage wrought by Yolanda only motivated them to take an even more proactive approach and had made progress through the help of the people and the international community.
“We are hopeful that moving forward, you will still be there to help us. The road ahead promises many challenges, but we are convinced that with the backing of our people, and with the right partners in the private sector, we will prevail. We will complete the rehabilitation and improvement of the affected communities sooner rather than later; and all of you will see those areas brimming with more opportunity than ever before,†Aquino said.
The President said rehabilitation efforts would dovetail seamlessly into plans for the economy in the medium and long term. He said the government had focused on growing certain industries the past three years: whether agriculture, infrastructure, tourism or manufacturing, which grew 10.5 percent in 2013 and became of the main factors in building on the economic momentum.
Infrastructure spending has also increased significantly-from P304 billion in 2013 to nearly P400 billion in 2014, Aquino said, and more tourists were being enticed to visit the country. Apart from liberalizing the aviation industry back in 2011, the President said Philippine Airlines, the flag carrier, managed to fly directly to and from Europe and the government was likewise pursuing the construction of three new major airports and were looking to rehabilitate more than 50 others in strategic areas.
“In agriculture, we are looking to stimulate growth, especially after some of our progress was stifled by the disasters of the past year. The plan: to continue developing irrigation mechanisms and agricultural infrastructure, with an eye on creating a more dynamic synergy between our farmers, and the markets and industries in their milieu,†the President said.
“These, among others, have opened the floodgates of opportunity in our priority sectors. We are fully intent on keeping up the pace of our progress. Despite our early success, we are still making a push to meet the targets we have laid out. For example, even as we welcomed 4.7 million international tourists in 2013, we are committed to making a run at our 2016 target of 10 million international tourists,†Aquino said.
The President said the administration would also pursue laws that would keep business environment conducive to growth, including the amendments to the Build-Operate-Transfer Law. “Our intention is clear: to create smoother working conditions between the private sector and the government, which will help government consistently harness your efficiencies as we all engage in the communal task of nation building,†he said.
Because of its reforms, Aquino said the country received an investment grade from major credit rating agencies Standard & Poor’s, Moody’s and Fitch and defied expectations on several measures of competitiveness citing the Philippines’ climb in the World Economic Forum’s Global Competitiveness Rankings to 59th place, improving a total of 26 spots over the last three years.
It also recorded a marked improvement in the World Bank and International Finance Corporation’s Ease of Doing Business Report, moving up 30 places in just one year. The Heritage Foundation also bumped the Philippines up in its 2014 Index of Economic Freedom - 89th out of 178 countries-an eight-notch improvement from the previous year.
On top of this, after a 2013 survey of companies in Asia and Oceania, the Japan External Trade Organization said that the Philippines was the second most profitable among ASEAN-5 countries, trailing only Thailand. “This is particularly impressive, considering that in 2010, we were dead last,†Aquino said.
“These developments are unimpeachable proof: The large-scale turnaround of the Philippine economy is gaining even greater momentum. The days when we were called the Sick Man of Asia are becoming a distant memory. Now, we are seeing so many international organizations and publications expressing optimism about our future, and they have already referred to us as ‘Asia’s Bright Spot,’ or as the ‘New Asian Tiger.’†Aquino said.