Tuesday, 21 March 2017 10:08


IN his presentation before multi stakeholders, Finance Secretary Sonny Dominguez said, “in this administration, start means groundbreaking and actual construction.” With a ticket price of P326 billion, covering railways, bridges and dams, Dominguez pointed out that under the Duterte administration, “when we say start, we do not mean just bidding out projects, signing contracts or attending opening ceremonies.” He added, “we will no longer tolerate the wishy-washy promises that implementing agencies have been accustomed to making in the past.”

The three railway projects outside Metro Manila, new public transport lines along the main Metro Manila artery, Epifanio de los Santos Avenue (EDSA), will begin construction this year. The three railways are Clark-Subic, Tutuban-Clark and the 581-kilometer South Line of the North-South Railway Project connecting Tutuban, Calamba, Batangas and Bicol. The Department of Transportation (DoTr) will be the implementing agency of the rail projects, with funding to be a combination of official development a ssistance, public-private partnership concessions, and government funds.

The construction of the Kaliwa and Chico River dams will also start this year together with projects at Clark International Airport, the Metro Manila Bus Rapid Transit traversing EDSA, and three bridges across the Pasig river. The dams will be funded by China

By 2018, construction of long-span bridges between Bicol and Samar,and between Leyte and Surigao, will finally make land travel between Luzon,Visayas and Mindanao possible. The 2000-kilometer Mindanao railway—which will connect its large cities—may start construction next year, as well as more bridges crossing the Pasig river, and the development of Clark Green City.

The planned infrastructure buildup will attract more foreign investments, as well as boost productivity. Budget Secretary Benjamin E. Diokno earlier said that geo-tagging will be used to closely monitor the infrastructure projects to be rolled out this year in order to fast-track implementation. Diokno stated that “part of the plan to make the six years of the Duterte administration a so-called ‘golden age of infrastructure’ was spending P846.3 billion, or 5.3 percent of gross domestic product (GDP), on infrastructure this year alone. The budget for infrastructure expenditures in 2017 accounted for a fourth of the total and was 13.7-percent bigger than last year’s program.

Hybrid financing “would enable the government to profitably manage the leveraging” of close to P1 trillion in official development assistance (ODA) and loans that it had secured from Japan and China alone in just six months of the Duterte presidency.” Hybrid financing would bring down borrowing costs. Dominguez explained leveraging on hybrid financing by using part-ODA and part-multilateral agency loans actually increases the number of projects that can be done. “Hybrid financing would involve, for instance, a mix of ODA, which provides concessional interest rates of 0.2-0.5 percent, with development funds from the Asian Development Bank (ADB) and the World Bank to execute an infrastructure project. Combining both types of financing sources would thus enable the government to build more big-ticket infrastructure projects.”

These statements, coming from the top finance and budget managers of the country, are more important than any “palitulo” video statement by a reckless Vice President or an impeachment complaint that is a time-honored practice of a party list that has always been in the forefront of destroying buildings and institutions. For them, start means destroy the presidency. It is no longer destabilizing but ousting a duly elected President because they just don’t like him.

Furthermore, the yardstick used to measure a leader has changed. Apparently, the yardstick for Aquino cannot be applied for Duterte because Aquino, in their eyes, is the epitome of what is just and good. And you can run down the issues against Aquino from the Luneta hostage crisis, Yolanda, Mamasapano, KKK, Zamboanga siege, missing in action days, Napoles, DAP-PDAF, rigged impeachment of Chief Justice Corona, missing Malampaya, intel fund on crimes, unliquidated advances of his core Cabinet officials, and a lot more but his six years appear to be the model of governance and the nine months of Duterte is so appalling that he needs to be removed.

And as start is being invoked in building the nation, start is also the flag waved to destroy it politically. We have never had our politics serving what is best for our nation, save probably the time of FVR. Post-EDSA, our politics have been a drag. We removed President Estrada for his way of governing and his midnight Cabinet. We installed PGMA but needed to hold her captive because of alleged cheating putting her legitimacy at issue. We elected an Aquino again because he was an Aquino. And now we have the first mayor and the first Mindanaoan, we want to oust him because he is reportedly a killer. We never seem able to respect mandates of our leaders. Oust we must and that can be either removing the elected leader or weakening the foundations of the nation, causing it to spiral away.

In the old days, when before foreigners, we speak with one voice. Today, using seal and flag, we have a Vice President who, for her own convenience, spins things to put down an elected President. When a video is made in February and aired in March, saying “palitulo” is by design, you had all the time in the world to reframe. But with malice, the Vice President shot down the presidency and the PNP.

And then an impeachment complaint which is a rehash of all the accusations thrown PRRD’s way since the campaign, covering hearings in the Senate, scripted, staged and handled by Senator Antonio Trillanes and Senator Leila de Lima and supported by other Liberal Party senators. A cursory review of the complaint shows that securing a conviction is not what they have in mind. It’s destroying the economy; making investors leave are the two goals of those who lost in the 2016 elections.

There are two drivers of the economy: OFW remittances and BPO. Tinker with one, we implode. There are also investors waiting in the sidelines but the shaking that Robredo, Trillanes and the Liberal Party are doing of a man who won an election are becoming more and more strident. Should we worry? Nope, but let us start. Let the crybabies do their thing and let us all pull in one direction with Duterte, and row in unison across the rough seas. About time we let the vultures eat the dried carcass fed by soiled yellow hands and the living start rowing towards our promised land. We are captains of our fate and “every nation determines its own destiny; the cleverer the nation, the better the fate!”
Published in Commentaries
Tuesday, 07 March 2017 10:05

Multiplier effect

DAVAO is “three times bigger than Metro Manila, six times the size of Cebu, one of the largest metropolitan areas not just in Asia but in the world.” Today, it is the unofficial capital of the country. The Davao formula was for the mayor to handle peace and order, use political will to build the city, and the local bureaucracy to attend to the rest. Can this formula be scaled up to the whole of the country?

To a certain degree, yes, in terms of peace and order and infrastructure development. The other side of which is, no, because you have an unwieldy legislature trying to curry favor with PRRD (death penalty for illegal drugs?) or launch diatribes against him (EJK, Matobato, undeclared wealth, Lascañas and every anomalous act is labeled as done by Duterte). The 17th Congress in fact has just enacted two bills into law: the General Appropriations Act, or the national budget, and the postponement of the barangay elections. There are no super majorities because if there were, the legislative agenda of the President would have been on track.

PRRD has convened the Legislative Executive Development Advisory Council (LEDAC) and the chambers have crafted their own agenda. A common legislative agenda is said to be in the final drafting. Though we can do without more laws considering there are laws that have not been implemented fully and there are unfunded mandates, we need more and more for Congress to exercise its oversight function over the Executive and Judicial branches if it is to help PRRD in his effort to pursue reforms.

In a study done by the Congressional Policy and Budget Reform Department of the House of Representatives, there are “62 laws [that]remained partially funded while 75 laws were not funded at all as of 15 October 2015. Unfunded laws grew by 127.3 percent from 33 in 2007 to 75 in 2015, while partially funded laws grew even higher by 376.9 percent from 13 to 62 in the same period.” These laws amounted to “P367.3 billion. Of this amount, only P242.1 billion was allocated, leaving a funding deficiency of P125.2 billion.” Unbelievably, “the House committee on oversight (13th Congress) which made an inventory of unfunded laws even indicated that two laws enacted by the First Philippine Republic—the Friars Lands Act (1904) and Cadastral Survey Act (1913)—were not implemented because they required a huge funding of P1.5 billion.”

So if Congress can’t act as a direct partner to PRRD on infrastructure development and decides to use their pork for the innocuous projects that do not build a nation, then PRRD and his political will should push the envelope daily until such becomes the bureaucratic discipline. Why? Because doing infrastructure development is the way to respond to some promises of the President: inclusive growth, lowering poverty by the end of his term, providing jobs and bringing sunshine (economic activities) to the poorest provinces.

With political will, PRRD can connect the 7,641 islands by a system of airports, ports, bridges and rails. The bridges can be tourist attractions just like the bridges in Porto, Portugal. Porto is the second largest city after Lisbon and it has a mixed transport system of bus, rails, trams and subways. One can do a tour of the Duoro river and see the different designs of the bridges; some are modern while others are historical in make and design. If PRRD can implement Build.Build.Build and other infrastructure plans every year in the three islands of the country then we would have done much, much more than any administration has.

The nautical highway of then PGMA must be continued and further developed. Just look at the development it brought to Roxas, Oriental Mindoro. Roxas, the smallest municipality of the province, was a sleepy, fourth-class municipality. Today, it is a place of heightened economic activities because of the nautical highway, connecting its port to the famous destination, Boracay. Today, it is a second-class municipality from being a pass-through from Batangas to the Calapan piers and to Caticlan, Aklan.

The underlying reason for pushing for Build.Build.Build is that of the so-called multiplier effect. We can be competitive at the end of PRRD’s term if we are able to launch and implement the infrastructure plan. The multiplier effect is “an increase in income generated by an increase in spending,” which should be part of our national conversation. Such conversation should not settle for mere infra for infra sake but “wise” infra investment. The qualifier “wise” refers to projects that fill a need of the community they serve and which are economically viable. A key lesson is that “projects that have a lot of private capital behind them would have the biggest impact because more often than not they won’t be a road to nowhere.”

Further, it has been a settled model that “an additional 1 percent of GDP invested in transport and communications on a sustained basis increases the GDP per capita growth rate by 0.6 percent. “Productivity growth— and therefore competitiveness—is higher in countries with an adequate supply of infrastructure services.” So, we can even pursue a smart infrastructure development of a mix of hard and soft infra with ICT merged to it to create a resilient Philippines.

Clark should therefore be made as the main gateway, with Subic and Batangas designated as alternative, complementary ports to Manila. Clark and Subic should serve the northern part of Luzon while the south (CALABARZON) can be served by Sangley airport and port system. NAIA can be dedicated to the 12 million residents of Metro Manila. A tri-airport system in Luzon unclogs the bottlenecks of Metro Manila and spurs development from center to the peripheries.

Our unique geography, between East and West, allows us to be a competitive logistics hub. In a Transport Intelligence Report (TIR) in 2015 estimated “Philippine logistics to triple to P326 billion by 2020 from the present P100 billion.” TIR said that by 2020, based on low 11 percent compounded annual growth rate (CAGR) and high of 18 percent CAGR growth scenarios, the logistics market is forecasted to reach P204 billion (low) to P326 billion (high).

The forward linkage index of the Philippine logistics industry as of 2011 was placed at 1.4, the lowest in Southeast Asia, compared to Indonesia, 2.1; Thailand, 2.73; Cambodia, 2.48; Vietnam, 2.64; Thailand, 2.73 and Malaysia, 4.03. Based on the study, logistics’ multiplier effect is such that “every P1 investment has a multiplier of 2.81 investments in other industries such as services.”

There are 109 local and foreign logistics service providers in the country with aggregate revenue of P60 billion. They are very much concerned over the provision of efficient transport infrastructure, conducive policy environment, and regulations that will foster the logistics sectors’ competitiveness in terms of cost, service quality and reliability.

Based on a 2010 traffic study by the Japan International Cooperation Agency in Metro Manila and its environs, truck trips (per day) is expected to increase from 694,271 in 2010 to 872,329 in 2020 and 1 million by 2030. The share of trucks going to and from Manila is 60 percent. That means, we need to increase our road networks.

The Department of Public Works and Highways’ (DPWH) budget has increased dramatically over the last four years. In 2015, almost half (49 percent) of the government’s outlay infrastructure went to DPWH. The big challenge is improving the paved ratio of local roads that comprise 84.5 percent of the country’s total road network. Provincial and municipal roads have a low paved ratio of 35 percent, while city roads have a paved ratio of 62 percent.

Trains and trams are something we need to seriously pursue. Trains can be transshipment mode for raw and finished products, from Mindanao to the Visayas or Mindanao to Luzon. Trams can be an efficient mass transit in urban centers to the peripheries. But Congress will have to contend with the problematic Philippine National Railways (PNR) mandate, which has been pending in Congress despite the extension of its corporate life.

The good news is that under PRRD, the infra spending has been placed at 7 percent, an increase of 2 percent from BSA3’s 5 percent. The other good news is he is hands-on on infra coupled with the political will to push the projects fast. When we see projects launched and a building spree all over, then we test the government’s effort on corruption. If the infra projects are corruption-free, then we see why a Duterte is better than the rest. The surest way to defeat destabilization efforts is to perform well and accomplish more. Unfortunately, the Department of Transportation (DOTr) and the Department of Information and Communication Technology (DICT) are laggards instead of being shining stars. The social welfare clusters are moving. The economic clusters have rolled up their sleeves and the DPWH is getting things done. Agriculture is moving to remove bottlenecks one by one. The uni-dimensional focus must end.

The Duterte administration needs at least P8 trillion to close the infrastructure gap over the next six years. An initial list of 18 big-ticket items worth a total of P427.5 billion has already been approved by the National Economic and Development Authority. Clearly, accelerating infrastructure spending to help pull down the poverty rate to below 15 percent by the time he steps aside in 2022 is vital.

The reality is that the total resources of the Philippine financial system is P16.2 trillion and the Duterte administration would have to invest about Php8 trillion over the next six years on infra to be on a par with Asean. So, the more Congress spends time on this problem area, the better for the whole infra plan to be a reality.

Getting your act together has a multiplier effect, too. It quiets the shrillness in politics. Getting your act together is getting all hands deck, no lone stars. Getting your act together is no public meltdown; the only meltdown should be on tasks not done. From June 2016 to March 2017, or eight months hence, hold the reins tight and get things done. Don’t be derailed by the political noise.

As Socrates said, “the secret of change is to focus all of your energy not on fighting the old, but on building the new.”
Published in Commentaries
Tuesday, 21 February 2017 09:42

Legacy Islands on Water

IN Asia alone, there are 17 reclamation projects of note, such as: the coastlines of Mumbai, India; the coastlines of Mainland China, Hong Kong, North Korea and South Korea; the inland lowlands of the Yangtze Valley, China, including Shanghai and Wuhan; the coastline of Karachi, Pakistan; part of Hamad International Airport; the entire island of The Pearl-Qatar situated in West Bay (Doha) Qatar; Hailou Bay, Hainan Province, China as well as the west side of Haitian Island and Haikou City are all being extended; Cotai Strip in Macau; Nagoya Centrist Airport, Japan; Incheon International Airport, South Korea; Beirut Central District, Lebanon; and Europe, Africa and the Americas have their share of reclamation projects, too.

The Philippines has 7,641 islands and this number could still grow through land reclamation. What reclamation? The so-called enemy of environmentalists, right? But hold it and let’s see what kind of reclamation this is, considering we have lessons learned from the reclamation of Manila Bay in the past.

The Philippine Reclamation Authority (then known as the Philippine Estate Authority per EO 380 as of 2004) is set to build what is known as Legacy Islands on Water. Conscious of the issues attached to reclamation, the PRA has adopted three strategies: 1) purposive reclamation; 2) protective reclamation and 3) capacity development.

Purposive reclamation refers to Legacy Island on Water, or LIoW, that is “liveable, resilient, safe, sustainable, green, generative, pro-people, future-proofed and innovative, and a smart community.” On LIoWs and related developments, “the integration or combination of economic zones, smart community infrastructure, mangroves, flora and fauna eco-systems, renewable energy facilities, coastal protection structures, green landscapes and blue water, socialized housing units, water collection systems, waste management methodologies, public access networks, and mixed-used development are critical.”

Protective reclamation refers to an integrated coastal defense development based on the model funded by the Kingdom of the Netherlands for the “Coastal Protection Strategy for the City of Tacloban and Municipality of Palo, Leyte.” The PRA will seek assistance from donor and multi-lateral agencies, foreign governments and partner organizations to finance and conduct other studies for storm surge and coastal flooding-prone areas identified in the study. Preliminary inspection and assessment of the cities of Butuan, Bislig and Surigao have been conducted.

Organizationally, PRA Learning Ecology has been established. Capacity development programs, at the professional and personal levels, have been identified. If PRA has a green army, reclamation won’t be a zero-sum game.

Imagine a Philippines with additional destinations, self-contained agricultural estates, dairy farms, logistic hubs, tree farm islands; renewal energy model islands that can harness energy for use in the island and as inputs to grid in the main islands, etc. The possibilities are limitless. What if the areas that are part of our territory where there were land bridges before are reclaimed? Think about the possibilities but yes, as in other forms of development, there are issues on reclamation. There are advantages and disadvantages of land reclamation and knowing these is a sure way of avoiding and working around the issues.

Land reclamation means “more land has been made available for development. More buildings and infrastructure can be built, and also for other reasons.” The ability to connect the islands by ports, bridges, rails and airstrips are made easier. It may not be a concrete jungle but eco-tourism zones and industrial estates or model smart cities can be the blueprints. They can be the gems of federalism because the legacy islands will become the magnets of growth.

The disadvantages are aplenty as documented from various experiences: “Much greenery has been removed in order for the land needed. Land reclamation can be damaging to corals and marine life. Corals are usually moved to another place when land is to be reclaimed. The corals might not be able to survive in that certain habitat, and thus die out. In some countries, where the project is large-scale, they do not even bother to re-plant the corals elsewhere, instead just reclaim the land on their habitat, causing them to die out immediately. Marine life, such as fishes, might not have enough food after the underwater plantations are destroyed due to reclamation of land. This applies to the food chain. The waters might also be polluted from the soil used to reclaim land, causing the fishes to die and blocking out sunlight, depriving the underwater plants of growth. Marine habitats are also destroyed, as mentioned earlier; therefore, the marine creatures would be forced to move to another new habitat.” Can we mitigate the disadvantages? Manila Bay was reclaimed in the 1970s-1980s. The second phase took place in the 1990s. We learned from such plans and with new technology can do better reclamation today.

As in mining, the rigid environmental impact assessments (EIAs) should be able to assess environmental issues with regard to land reclamation projects. If the project is an environmentally critical project or is in an environmentally critical area, EIA is mandatory. EIAs normally consider issues such as impacts on species and habitats, other human uses (e.g. fisheries, navigation, recreation, cable and pipeline laying), international and national marine protected areas, water quality and coastal processes (sediment transport, erosion, sedimentation, hydrodynamics). The results of an EIA may affect the design/shape of the land reclamation, the public consultations and the permit conditions.

Of essence in planning for LIoW is a citizens’ monitoring feedback mechanism that encourages the participation of citizens in governance. Social acceptability of high impact projects is critical and getting the communities involved in the process will determine success or failure of a project.

Building a nation is not easy. It has never been been easy. But taking the first step and building a common platform to move makes the bottlenecks bearable. It will be hard, but let’s find the common ground.
Published in Commentaries
Friday, 10 February 2017 10:10

Economic managers junk free tuition

The government’s economic managers have junked the proposed across-the-board free tuition for students in State Universities and Colleges (SUCs), saying it is unsustainable and will only benefit the rich.

They said the Unified Student Financial Assistance System for Tertiary Education (UniFAST) is a better alternative.

In a joint position paper submitted to Executive Secretary Salvador Medialdea, Socioeconomic Planning Secretary Ernesto Pernia, Finance Secretary Carlos Dominguez 3rd and Budget and Management Secretary Benjamin Diokno said UniFAST provides a more coherent and comprehensive framework to address the educational needs of students.

The economic managers said that while all citizens have the right to quality education, they do not agree that an across-the-board free tuition for all undergraduate students in SUCs is the best way for the government to achieve the mandate of providing education to all.

“The proposed free tuition policy is expected to have little impact on poor children’s enrolment in college,” they said, stressing that tuition does not comprise the biggest share of the cost of college education.

Based on the grant structure of the government’s Student Grants-In-Aid Program for Poverty Alleviation (SGP-PA), tuition constitutes merely one-third (P20,000) of the annual cost of P60,000 per student covered by the grant.

The officials said living expenses make up the biggest chunk of the cost of college education (P35,000 for 10 months). Instructional materials comes third at P5,000.

Since poor families will be unable to pay for the two-thirds cost of college education, they will still be unable to send their children to college.

“The proposed free tuition policy will benefit largely the non-poor students who predominate in SUCs. In 2014, only 12 percent of the students attending SUCs belong to the bottom 20 percent of the family income classification based on the Annual Poverty Indicators Survey,” the economic managers said.

They believe that an untargeted tuition subsidy to undergraduate students enrolled in SUCs will mostly benefit families who can afford to send their children to college while many deserving and qualified poor students unable to enrol in SUCs will be left out.

The economic managers also pointed out that an across-the-board free tuition policy will trigger an exodus of students to SUCs which would eventually affect the overall quality of graduates given that a number of private higher education institutions perform better than SUCs.

“Also, the budgetary support for free tuition will be difficult to sustain,” the Cabinet officials said.

They explained that if the tuition funding requirement is to be based on the national average tuition of SUCs under the SGP-PA – which is at P20,000 per annum – the estimated 1.4 million students currently enrolled in SUCs would require about P28 billion budgetary support from the government.

The economic managers recommended funding UniFAST instead, which they said is better designed to ensure a more efficient and effective use of government funds.

Established in 2014 through Republic Act 10687, UniFAST is designed to unify and harmonize all modalities of publicly-funded Student Financial Assistance Programs such as scholarships, grants-in-aid and student loans for tertiary education. The law provides full financing to deserving students, which generally favors the poor.

The officials argued that UniFAST is the better alternative because it has a clear delineation among its three modes of financial assistance in terms of objectives and target beneficiaries, applicability in SUCs and private educational institutions, a test-based eligibility requirement, and adherence to the acceptable standards of the Commission on Higher Education.

“The government should implement its mandate of promoting quality and accessible education within the limits of fiscal prudence, and with the use of appropriate tools and targeting mechanism. The UniFAST is better designed to ensure a more efficient and effective use of government funds,” they explained.
Published in News
Friday, 27 January 2017 10:01

Palace hails 6.8% GDP 2016 growth

MALACAÑANG on Thursday welcomed the 6.8 percent rate of economic growth in the country in 2016, the fastest full-year pace in three years.

Economic growth as measured by gross domestic product (GDP), the value of goods and services produced by the domestic economy, last year on the back of increased activity in manufacturing, trade and real estate.

In the fourth quarter of 2016, GDP grew by 6.6 percent, moderating from 7 percent in the third quarter but faster than the 6.3-percent growth recorded in the final quarter of 2015. This was enough to boost the full-year pace to its fastest since 2013, the Philippine Statistics Authority (PSA) reported on Thursday.

“The last quarter of an election year is usually weak with the government transition. However, in our case, it has actually improved,” presidential spokesman Ernesto Abella told reporters.

“The 6.6-percent growth in fourth quarter is a testament that our economy remains robust and is growing at a healthy and steady rate. Also, the Philippine economy is likely the third or fourth fastest-growing economy in the fourth quarter of 2016 after China and Vietnam,” he added.

Growth in 2016 topped the 5.9 percent pace registered in 2015 and 6.2 percent in 2014. The economy grew by 7.1 percent in 2013.

“Among the major economic sectors, industry had the fastest growth at 7.6 percent, higher than the previous year’s 6.5 percent growth,” National Statistician Lisa Grace Bersales said in a news conference on the 2016 national income accounts.

“Services decelerated by 7.4 percent from 7.8 percent growth in the fourth quarter of 2015. On the other hand, Agriculture declined further by 1.1 percent. In the same period of the previous year, it dropped by 0.2 percent,” Bersales said.

Full-year growth settled within the 6.7 percent to 7 percent forecast range by private analysts polled by The Manila Times, and within the government’s 6 percent to 7 percent target.

At 6.8 percent, the Philippines could become the second fastest-growing economy in Asia for 2016. China grew at 6.7 percent and Vietnam at 6.2 percent last year, according to the National Economic and Development Authority (NEDA).


Socioeconomic Planning Secretary Ernesto Pernia sees the industry sector staying vibrant, with the construction industry expected to be in the limelight following the government’s commitment to implement critical infrastructure projects.

The services sector is expected to remain strong, supported by moderate inflation, tourism and retail trade, as well as a healthy financial system, sustained growth of remittances and the continued expansion of the information technology-business process management sector.

“Domestic demand has so far remained buoyant, and should continue to provide support to economic growth in the near to medium-term. Improved employment prospects and favorable income conditions will underpin the growth in household consumption,” said Pernia, the NEDA director general.

Given the 2016 GDP result, the government target of 6.5 percent to 7.5 percent growth for 2017 is “highly likely” to be achieved, the Cabinet official said.

In the medium term, growth will strengthen further to between 7 percent and 8 percent, he said, forecasting the economy to expand by about 50 percent in real terms and per capita income by over 40 percent over the next six years.

“This should bring us to the upper middle income category standing by 2022. More importantly, we hope to reduce the poverty incidence to 14 percent by 2022, thereby lifting about 6 million Filipinos out of poverty,” Pernia said.


But the way toward the goal is not without risks, Pernia warned, citing the impact of bad weather, policy shifts in the United States and the geopolitical situation. “For now, our biggest roadblock is an extreme weather disturbance like that of the El Niño,” he said.

He called for the development of the agriculture sector to make it resilient to shocks.

“We are deeply concerned about the contraction of the crops sector in the fourth quarter following a contraction the previous year. More disturbing is the performance of the fishery subsector that remained in negative territory for almost seven years now, except only in 2013,” he said.

Pernia said nurturing entrepreneurship and attracting investments that produce higher-paying quality jobs, especially outside of Metro Manila, were among the government’s significant goals.

Such requires a secure and stable economic and political environment, he said.

“Moreover, we need to ensure that our sectors are resilient and diversified in both of products and markets. In particular, we need to champion innovation and diversification in the industry sector as it is still heavily dependent on external demand,” he said.

In the services sector, Pernia cited the need for a policy environment that makes it easier for firms to set up and operate businesses and heed regulations.
Published in News
Friday, 20 January 2017 10:51

Stop exporting people- growth guru

ONCE more, an international expert on economic growth and policy-making has suggested that our government must reduce our dependence on exporting Filipino labor and focus on creating more jobs.

This time it’s Dr. Dan Steinbock, founder of the Difference Group, a global consultancy and research outfit, who made the analysis.

He said the Philippines could take advantage of its good demographics—in other words its huge population, by harnessing its potential in manufacturing, electronics, information and communications technology and tourism, among other sectors.

We think President Duterte and his government’s economic managers have this goal engraved in their brains—as it is in the mind of every thinking Filipino. But it’s good that experts like Dan Steinbock remind our top government officials and policy makers when they come to visit our country.

That’s because each powerful office holder has his and her own personal likes and dislikes, favorite areas of expertise, comforting memories of success and jobs well done and can all choose to make their favorites their goal-to-achieve priorities.

We’ve lauded President Rody Duterte’s choice of ending the reign of criminals and lawbreakers, especially drug lords, in our neighborhoods and a vigorous war against government corruption for his top priorities. And he has been quite effective in performing what needs to be done on these fronts in the half-year or so that he has been our President.

We must also praise the President for his administration’s initial good work in the economic growth and business fields, as Mr. Dan Steinbock did.

The global economy pundit commended the President for his correct response to the new world order’s call for stronger national economies as forces of globalization and integration wane and mature economies are frozen in the fight for growth.

He said President Rodrigo was on the right path in making it a policy goal to bring home the millions of overseas Filipino workers (OFWs) and generating jobs here at home for them by attracting foreign investment and upgrading the country’s infrastructure.

“Duterte is making the right move. It will be the first time in five years that I can sit down and say that you have chosen the policy stance that makes sense, most importantly investment. Whether it comes from foreign sources or domestic, you cannot build infrastructure without it,” he said.

He said something that other analysts seldom talk about: that having a huge population is an asset. But of course the country’s leaders in government, business and industry must prepare the ground for the millions of workers to have jobs. He criticized past leaders for being complacent about this, wasting these assets and opportunities. He warned that a huge population turns into a destabilizing force in the future—if not allowed to exercise their capabilities to be productive.

But he insisted that a huge pool of young workers, together with the economic environment that makes their capabilities productive through jobs, is what yields high economic growth.

This has unfortunately not been attended to by successive generations of Filipino government and private sector leaders. And this, Mr. Steinbock said, is why a great chunk of the working population has been forced to work overseas—and are supporting the country with their earnings abroad.

“Demographics is not enough unless you have jobs. We saw in Latin America what happened [in the 1950s to 1960s]. They had youthful demographics but no jobs,” he said. “So for me, demographics is actually really important. You cannot have a major change without it. However, if you don’t have jobs, you have a problem.”

He decried our country’s failure to make our asset an instrument of growth. He was not happy with the policy of encouraging OFWs to be our main source of income.

“When you export people, you don’t grow. You have to have the people…It just doesn’t work [to make them leave home]. Look– any sustainable, fast-growing, large emerging economy, none of them are exporting people.”
Published in Commentaries
Friday, 06 January 2017 11:05

Economy seen growing over 7% this year


MANILA, Philippines – First Metro Investment Corp., the investment banking arm of the Metrobank Group, expects the Philippine economy to remain strong in 2017.

The country’s gross domestic product (GDP) is expected to grow by 7 to 7.5 percent, driven by higher capital investments as the Duterte administration continues to ramp up infrastructure spending coupled with sound foreign direct investments, strong consumer expenditure, stable OFW remittances and sturdy BPO sector.
Published in News


The economy grew by 7.1 percent in the third quarter of the year, the fastest since the second quarter of 2013 at 7.6 percent – driven largely by the strong performance of manufacturing, trade and real estate, the Philippine Statistics Authority (PSA) announced yesterday.

Published in News
BusinessMirror Reporters VG. Cabuag, David Cagahastian, Manuel T. Cayon, Jovee Marie N. Dela Cruz, Cai U. Ordinario, Mary Grace C. Padin, Catherine N. Pillas, Joel R. San Juan and Butch Fernandez

MANILA and DAVAO CITY–HE’S excited. For Manuel, a confidential National Bureau of Investigation (NBI) staff, the excitement comes from the possibility of being regarded as an FBI agent.
Published in News