Tuesday, December 4, 2012

On whose terms?

People invariably demand that they see the world on their own terms. And despite their blind spots our neighbors have zoomed pass us becoming First-World nations even. Thanks to their leaderships – they made the difference. And thankfully too, because of President Aquino, the international community is today warming up on PHL.

Before the president’s "daang matuwid" it was not uncommon for us to justify our nonchalance about corruption, for instance, because every nation can't be clean? In fairness we’ve come out with loads of prescriptions on how we could move forward. But unwittingly we may have accepted that we are a badly engineered machinery and thus in band-aid solution mode, meaning that we’ve been sidestepping the roots of our problems?

The European Union Commissioner for Transport . . . told . . . Vice President Binay that “when it comes to air safety, we don’t have friends” and the EU remained non-committal on the possibility of lifting the ban on Philippine carriers . . .” [Manila Standard Today, 2nd Nov 2012.] [The] CAAP head . . . said only two out of the 22 actionable items identified by the US FAA as safety concerns remained unresolved, namely the lack of qualified safety personnel and the absence of an integrated IT system to modernize the sector’s database.” But these are run-of-the-mill issues – not rocket science – and which is why Business Mirror, 2nd Nov 2012, screamed: “Leadership problem caused CAAP failure.”

The administration of President Ramos saw the dire situation in our power supply. Decades later, in 2012, shouldn't we be reaping something more tangible than: "The draft Power Development Plan for the Luzon Grid for 2012-2030 of the Energy Department . . ." [MST Sunday, 3rd Nov 2012.] The operative word is draft? And beyond that is a sprinkling of "indicative projects." It says we simply don’t get major projects done timely and right? We are not operating in a vacuum. Friendly nations are competition – for investment and technology and thus innovation, talent, products and markets. And so "daang matuwid" is criticized because the test of the pudding is in the eating? But is the continued poverty or destiny of Juan de la Cruz in fact in the hands of powerful local cliques?

The Philippines may be “open for business” . . . But if the business is cornered by the powerful local cliques . . . then that particular sector is locked shut, whatever the consequences on the investment climate and the national economy,” writes Jojo Robles, Manila Standard Today, 1st Nov 2012. “An international consultant working on the aborted $1.5-billion investment package from Qatar and Kuwait has confirmed . . . that the visiting emir . . . personally ordered the Bank of Qatar to abort the transaction in a fit of royal pique . . .”

And the biggest local players don’t even have to excel globally. Our business model, “to monopolize and/or dominate local market,” is dated and a confirmation of our cacique structure. Reports the Manila Times (2nd Nov 2012): Ayala Corp., one of the biggest conglomerates in the country, has been generating a negative or low income from its international businesses . . . during the past few quarters . . . [The] Strategy and Development Managing Director said . . . that while their core businesses are doing well, their international businesses are relatively failing to excel” . . . The bottom line: Even our largest enterprises can’t be operating on our own terms as Poland has realized, Unless Poland turns itself into an innovative, knowledge economy, it risks heading down the same path as Spain, Greece, or Portugal,” Reuters, Poland stumbles on journey from low-cost to hi-tech, 28th Oct 2012.

Those countries mirror some of our ways. And in the case of Poland they too pride themselves in their BPO expertise. My old MNC employer established its European shared-services center in the country and it has emerged as a best practice model that they will replicate in other regions. "Poland has thrived on attracting low value-added businesses such as television assembly plants and off-shore accounting and call centers . . . The statistics show just how poor Poland is at innovation. The country spent 0.74% of GDP on R&D in 2010, much less than the 2% on average in the EU . . . [The good news] is the government is doing something about the problem. [It is not] a civilization leap, but regulatory and systemic changes will allow Poland to surprise many countries. This requires five, maybe 10 years."

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