Tuesday, February 26, 2013

The path of least resistance

It is human nature but we Pinoys seem to take lots of this path? When my wife and I are on our periodic homecoming, "how PHL is doing" invariably becomes part of the conversation. And while we had heard most of them before, the culture of impunity especially corruption still boggles the mind. It's too bad, so sad.

It sounds like our economic managers who have been trying their darnedest to raise revenues are getting it from all sides. ”They want to tax everything and don’t be surprised if even the air we breathe – polluted as it is – is subject to VAT.” Of course laughter is our way of life! “But the more rules there are the bigger the room for compromise; and it also explains why tax collection will hardly be honest and efficient. In a “system of compromise,” who knows what gets into government coffers? Do you know how much is lost because of “ghost deliveries” of government purchases especially consumables that can’t be counted physically in real-time? Marcos was headed in the right direction, he wanted to gut the corrupt bureaucracy – but he overdid it and created his own bureaucracy (of cronies.)”

“Beyond NAIA 3, we want to push commerce and trade and beyond air transport, we need port facilities. And in both cases we are primitive – our efforts to raise competitiveness have failed from the get-go. In the south especially and in many provinces “brown-outs” are our normal, and just like our primitive air and shipping infrastructure, power is primitive. And in these industries, the chosen few are raking it in. We don't want strong foreign interests because we don’t want the system disturbed. That is how we define patriotism – and who cares about widespread poverty? Of course, the chosen few are now talking about investing in the region because of Asean, but we always take the path of least resistant. We will never confront our reality because the chosen few (and their minions) on the one hand, and the bureaucracy on the other, are too ensconced to want change or reform.”

And so it was refreshing that a Pinoy investor was chatting about raising the competitiveness of his business interests and another, about the efforts to professionalize their organization. There may be more of them given that we have lots of SMEs. The real challenge is our various leaderships: of the economy both public and private and public service itself, for example? Every nation has its shortcomings like corruption, but when every other country has left us behind, the only conclusion to make is that their leaderships, unlike ours, have been able to create a platform and environment conducive to progress and development. That is, if indeed we mean and want “an inclusive” economy?

For instance, the Indonesian BOI leadership was recently on TV and was explaining, beyond investment, the imperatives of technology and innovation. They want to move beyond natural resources as a key industry and into creating tangible technology- and innovation-driven goods and services. Of course, they’ve recognized that they would have to step-up infrastructure development to make this a reality. And it appears foreign investors find them credible pouring more investments in Indonesia than the Philippines.

In the Philippines, we still rely on miracles just to travel through EDSA. And driving through C-5 a couple of times reminded me of being driven from a city in India to a new manufacturing zone many years ago. I asked the Indian colleague at the wheels to mind the hordes of people and vehicles – lest we be a disaster waiting to happen. The following day I sat in the meeting room and after a few minutes inquired why the meeting hadn't started, only to be told that one of the attendees was in a vehicular accident. And driving on C-5 and noticing traffic building up, it was not surprising to see an injured (thankfully not worse) person in the middle of the road.

Like any undertaking, whether a major plan or even a brand concept, setting the bar low undermines the best of intentions. C-5 is meant to be an efficient road system which is why it had to be fenced. But there are gaps after gaps that allow pedestrians to cross and even access roads to small towns or villages. It is like having our cake and eating it too? And which we proudly call "Pinoy abilidad"? It is a formula for sub-optimized outcomes – and disasters waiting to happen.

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