Slow pace of forming Marcos economic team prolongs investor anxiety
MANILA, Philippines — Around this time after the polls in 2016, then presumptive president-elect Rodrigo Duterte had already bared his administration’s eight-point economic agenda.
The plans were announced by Carlos Dominguez III, a member of Duterte’s transition team who would later serve as finance secretary.
At the time, Dominguez was included in the names that Duterte himself floated as possible members of a Cabinet that would supposedly be patterned after that of Canadian Prime Minister Justin Trudeau.
Six years later, Duterte’s apparent successor, Ferdinand “Bongbong” Marcos Jr., is keeping the market anxious as the presumptive president-elect has yet to name the members of a new economic team that would be tasked to nurture the country’s recovery from the pandemic. It did not help that Marcos skipped public debates meant to give candidates a platform to explain their plans during the campaign trail.
"The market remains anxious until we get more clarity on his Cabinet picks, particularly on his economic cluster," Nicholas Mapa, senior economist at ING Bank in Manila, said.
"Investors will stay in holding pattern until then as they await the overall strategy and direction the new administration will take as we face headwinds early on in the lone six-year term," Mapa added.
Last week, the Philippine Stock Exchange index (PSEi) posted a weekly loss of 5.6% to close at 6,379.17 after uncertainties over the next administration trumped any positive sentiment from the release of forecast-beating 8.3% economic growth in the first quarter.
While the upcoming central bank meeting on Thursday would highly influence local share prices in the next days, Arielle Santos, equities analyst at Regina Capital, believes the stock market may hover within the 6,200 to 6,800 range this week depending on how quick Marcos can clear any doubts on his upcoming government.
Michael Enriquez, chief investment officer at Sun Life Investment Management and Trust Corp., agreed with Santos. "The sooner we see the personalities, the faster the sentiment can change to be more confident."
'Duterte had it easy'
So far, Marcos has only made public the names of two Cabinet officials. Sara Duterte-Carpio, presumptive vice-president elect and Marcos’ running mate, will lead the Department of Education while former Metropolitan Manila Development Authority (MMDA) chairman Benjamin “Benhur” Abalos Jr. has been chosen as interior secretary.
At a press conference last week, Vic Rodriguez, Marcos’ spokesman, said the camp is still "in the process of searching and looking up for possible nominees", and therefore cannot make one big announcement of all the names. Rodriguez also denied the authenticity of a supposed list of possible Cabinet members that circulated on social media last week.
Rodriguez added it was important for Marcos to appoint "competent and qualified" members of the Cabinet. But when Marcos announced Mayor Duterte's coming appointment as education chief, reporters were not allowed to ask questions, depriving the press of a chance to quiz him about the qualifications and characteristics one would need to lead the Department of Education.
READ: Spox says Sara Duterte 'qualified to lead DepEd'
To be fair, forming a Cabinet is a very difficult task for all incoming presidents. Although Duterte had already disclosed some names around this time in 2016, there were members who were only chosen and announced before June 30.
But Michael Yusingco, a senior research fellow at the Ateneo Policy Center, believes it was easier for Duterte to form his Cabinet compared to Marcos because of the massive support that the outgoing president got from experts and politicians. Marcos is the only son and namesake of the late dictator, who remains a polarizing figure.
"It is unrealistic to compare him (Marcos) to President Duterte. Candidate Rodrigo Duterte was an experienced public official and already had a working team when he won in 2016," Yusingco said.
"The transition was easy because many technocrats and political figures were willing to trust him (Duterte) and work for his administration. This is a reception which is seemingly absent in the case of the incoming administration," he added.
For Leonardo Lanzona, an economist at Ateneo De Manila University, the slow formation of Marcos’ Cabinet "further aggravates the general perception of the inadequacies of the newly-elected president."
"For a country that is recovering from the effects of the pandemic and in the midst of debt restrictions and inflationary pressures, this uncertainty can have very serious consequences," Lanzona said.
But, at the end of the day, any anxiety on the part of the big economic players is only momentary as Marcos is widely expected to continue Duterte’s policies, Sonny Africa, executive director at IBON Foundation, a non-profit think tank, said.
"They probably know that the incoming administration will give them the policy continuity they want," Africa said. — with Ramon Royandoyan
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