President Aquino has been included by Time magazine on its latest annual list of the world’s 100 most influential people. Aquino joined 22 other world leaders on the list including Pope Francis, US President Barack Obama and North Korean dictator Kim Jong-un. The magazine cited Aquino for facing down the Catholic Church and having the reproductive health law enacted, and for confronting China as it aggressively stakes its claim over nearly the entire South China Sea.
On the heels of the recent investment grade for the country given by Fitch Ratings and 6.6 percent GDP growth in 2012, Malacañang has reason to feel good about the Time story. Before the Aquino administration pops the champagne, however, it should also consider assessments by agencies such as the International Monetary Fund.
In a report for the Philippines released the other night, the IMF lauded the country’s economic performance. At the same time, however, the IMF called for more reforms to promote inclusive growth and improve the business climate to attract more foreign direct investment. The multilateral agency also cited the need to utilize capital flows for more big-ticket infrastructure projects.
Relaxing restrictions on foreign ownership can improve the business climate, according to the IMF. While the restrictions are imposed by the Constitution, laws have been passed and rules approved to clarify ownership limits and define the areas that can be further opened to foreign investment.
The administration has admitted that despite rosy economy figures and sustained high business confidence, growth has not been inclusive and bullishness is not translating into significant levels of job-generating foreign direct investments. The country has one of the lowest levels of FDI in the region and unemployment stood at 6.8 percent in the fourth quarter of 2012. That’s approximately 2.8 million jobless Filipinos, in addition to millions of others who are underemployed.
The daang matuwid administration deserves commendation for recent economic gains, which have attracted the attention of the international community. The “influential†President can continue to draw on his high public support to implement difficult reforms. With these reforms and decisive action, glowing reviews can be backed by better infrastructure, more investments and inclusive growth.