Tuesday, July 23, 2013

The common good II

The common good represented by Juan de la Cruz must find its way into our value system or we shall indeed be the laughingstock of the world? It is the 21st century yet our greatest value remains “Filipino first”? It is a great sound bite and an inspiring rallying cry yet is skin-deep as evidenced by our failure to put our house in order, stuck as an underdeveloped economy for decades and unable to stem widespread poverty. Proud Christians we may be yet we can't deny our culture of impunity which comes with our cacique hierarchical system and structure and the resulting lopsided economy that we celebrate. Kennedy’s call to the American people to confront a moral issue despite their proud Judeo-Christian heritage came from the recognition that their problems were man-made? And in PHL, while we’ve invoked nationalism and Christianity crab mentality, undoubtedly man-made, would be manifest in our antiquated infrastructure as well as the absence of an industrial base, an underdeveloped agribusiness, a deteriorating educational system, elevated unemployment magnified by a much grimmer underemployment picture. In short, an ugly picture that won't go away because we would take inaction – i.e., crab mentality that is in fact a race to the bottom – instead of the common good?

PHL is a ship adrift despite claims to the contrary. Granted that the financial services sector has been singing hosannas owing to specific monetary measures, our economy remains consumption-driven that is fueled by OFW remittances – akin to a “house built upon the sand”? A structure, be it an economy or whatever, must have the legs to stand firmly and proudly. And this is the same financial services sector called to task by the US Congress for their role in the great recession, i.e., the housing and credit bubble that brought the global economy to its knees while lining the pockets of bankers? They are opportunistic with no regard to a host country’s economic foundation – i.e., “hot money” can come and go because market investors look at the performance of money managers, the returns they deliver especially every period-end when they are to release investment-performance reports! [Disclosure: my family has been a market investor for decades; and my daughter and son-in-law come from Wall Street.] The harsh reality is the modern world has a wide range of investment options competing for investors. And smart economies like PHL ought to recognize that, not to be lulled by a solitary vehicle like the stock market – try foreign direct investments? The world has to take the good with the bad; thankfully, free will gives us the power to take the good – but no one will spoon-feed us with the good, our sheltered upbringing notwithstanding?

OFW remittances will remain resilient at 4-5 percent as the 10 million OFWS continue to send money home. The Philippines is currently the third largest recipient of remittances in the world after India and China.” [Phl seen to sustain growth thrust, The Philippine Star, 21st Jun 2013] “For an economy like the Philippines, which has mostly been driven by the Services sector in the past few years, structural changes to the economy are a necessary ingredient in creating employment for millions. Philippine Economic Society President Alvin Ang told the Business Mirror that structural change requires shifting the country’s economic growth to labor-intensive sources like Manufacturing and Agriculture. But this shift in growth sources takes years and even decades to occur.” [Where are the jobs, Business Mirror, 19th Jun 2013]

What the Aquino administration is waiting for are the actual investments. Once those investments come online and are already on the ground, the government hopes to be able to increase the jobs, particularly in the manufacturing sector.” At the end of the day, what the Aquino administration is waiting for, i.e., actual investments won’t come precisely because of our crab mentality on the one hand and a culture of impunity on the other? “Whether a local enterprise will survive the liberalized and highly competitive AEC market will depend on its productivity, export orientation, foreign equity, and company size . . .” [Filipino Companies, Gov’t Urged To Prepare For AEC, Manila Bulletin, 22nd Jun 2013]

“Kenneth Akintewe, portfolio manager at Aberdeen Asset Management in Singapore, observes that family-controlled big businesses in the Philippines dictate the terms of business in the Philippines: “There is a real hesitancy to allow foreigners to come in and have a major say on how businesses are run. Until that dynamic changes, it is difficult to see foreigners being particularly enthusiastic” about investing in the Philippines.” [Protectionist clauses in the Philippine Constitution restrict the flow of foreign direct investment, Priscilla Tacujan, Ph.D., The Philippine Star, 3rd Jun 2013]

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