Consider Build-Build-Build and the debate between PPP and ODA. Can they address PH pressing needs in infrastructure development?
Like the rest of the world, we heard about Greece and their economy. Let’s peek into their economy and figure out how we compare.
“Greece has a capitalist economy with a public sector accounting for about 40% of GDP and with per capita GDP about two-thirds that of the leading euro-zone economies. Tourism provides 18% of GDP. Immigrants make up nearly one-fifth of the workforce, mainly in agricultural and unskilled jobs. Greece is a major beneficiary of EU aid, equal to about 3.3% of annual GDP.
“The Greek economy averaged growth of about 4% per year between 2003 and 2007, but the economy went into recession in 2009 as a result of the world financial crisis, tightening credit conditions, and Athens’ failure to address a growing budget deficit.
“By 2013, the economy had contracted 26%, compared with the pre-crisis level of 2007. Greece met the EU’s Growth and Stability Pact budget deficit criterion of no more than 3% of GDP in 2007-08, but violated it in 2009, when the deficit reached 15% of GDP.
“Under intense pressure from the EU and international market participants, the government accepted a bailout program that called on Athens to cut government spending, decrease tax evasion, overhaul the civil-service, healthcare, and pension systems, and reform the labor and product markets. Austerity measures reduced the deficit to 1.3% in 2017. Successive Greek governments, however, failed to push through many of the most unpopular reforms in the face of widespread political opposition, including from the country’s powerful labor unions and the general public.
“In April 2010, a leading credit agency assigned Greek debt its lowest possible credit rating, and in May 2010, the IMF and euro-zone governments provided Greece emergency short- and medium-term loans worth $147 billion so that the country could make debt repayments to creditors. Greece, however, struggled to meet the targets set by the EU and the IMF, especially after Eurostat — the EU’s statistical office — revised Greece’s deficit and debt numbers for 2009 and 2010 upward. European leaders and the IMF agreed in October 2011 to provide Athens a second bailout package of $169 billion.
“The second deal called for holders of Greek government bonds to write down a significant portion of their holdings to try to alleviate Greece’s government debt burden. However, Greek banks, saddled with a significant portion of sovereign debt, were adversely affected by the write-down and $60 billion of the second bailout package was set aside to ensure the banking system was adequately capitalized.
“In 2014, the Greek economy began to turn the corner on the recession. Greece achieved three significant milestones: balancing the budget — not including debt repayments; issuing government debt in financial markets for the first time since 2010; and generating 0.7% GDP growth — the first economic expansion since 2007.” [https://www.cia.gov/library/publications/the-world-factbook/geos/gr.html]
Democracy is hard work.
Something we Pinoys must note is that tourism accounts for 18% of the Greece GDP. In the Philippines, it is 12.7%. However, then consider: “The number of tourists who visited Greece in 2018 rose to 30.1 million, with incoming tourist traffic recording an increase of 10.8 percent compared with 2017, data released by the Bank of Greece. Tourism revenues increased by 10.1 percent compared with 2017 and stood at 16.1 billion euros.” [http://www.ekathimerini.com/237970/article/ekathimerini/business/greece-hosts-over-30-million-tourists-in-2018]
That is a staggering number, 30.1 million tourists (an increase of 10.8 percent), more than four times the 7.1 million visitors the Philippines had in 2018, up 7.7 percent from 2017. Likewise, how it translated to revenues in billions of euros.
Indeed, they have something going for them, i.e., tourism infrastructure is well-developed. Take the Athens International Airport (AIA) and the Athens Metro, for example. We read about them when Greece hosted the Olympics in 2004.
“AIA began operation on March 28, 2001. [Its] ownership is divided between the Hellenic Republic (Greek State) and Private Sector in a 55%-45% stake following a PPP scheme for the airport company.
“Studies for [the] airport had been carried out from as early as the 1970s, with as many as 19 different locations being looked at before an area close to the town of Spata was chosen as suitable.
“Athens Airport SA, a state-owned company, was established in 1978 to proceed with the plans. However, after delays and slow development, the project was revived in 1991 with the then government launching an international tender for the selection of a build-own-operate-transfer partner for the airport project, with Hochtief of Germany being selected.
“In 1996, Athens International Airport S.A. (AIA) was established as a public-private partnership with a 30-year concession agreement. That same year, the €2.1 billion development finally began with an estimated completion date of February 2001. The airport construction was completed five months before schedule but was delayed opening a month due to surface connections to Attiki Odos not being completed. The airport officially opened on March 28, 2001.” [Wikipedia]
As the blog has raised, infrastructure development is not about a quick fix because like human development, it is generational – with many twists and turns. It demands foresight and dynamism.
Note the Greeks demonstrated foresight, especially if we consider another major infrastructure project: “The Athens Metro is a rapid-transit system in Greece which serves the Athens conurbation and parts of East Attica.
“It incorporates the former Athens-Piraeus Electric Railways (ISAP), which opened as a conventional steam railway in 1869, was electrified in 1904 and is now part of Line 1. Beginning in 1991, Attiko Metro constructed and extended Lines 2 and 3 and the Attiko Metro Operations Company (AMEL) operated these lines from 2000 to 2011.
“The metro network merged in 2011 when the Greek government created the Urban Rail Transport Company (STASY).
“It has significantly changed Athens by providing a much-needed solution to the city’s traffic and air pollution problem, as well as revitalizing many of the areas it serves.
“An extension of Line 3 is under construction towards Piraeus and also other extensions of existing lines, as well as a new line, are under consideration. The Athens Metro is actively connected with the other means of public transport, such as buses, trolleys, the Athens Tram and the Proastiakos suburban railway.
"The Athens Metro is hailed for its modernity, and many of its stations feature works of art, exhibitions, and displays of the archeological remains found during its construction.
“The three-line Athens Metro network serves 61 stations. The Athens Metro’s three lines carry approximately 1,353,000 passengers daily.” [Wikipedia]
Infrastructure development and tourism did not prevent economic contraction in Greece. Compared to the Philippines, they are even wealthier with a GDP per capita (PPP) of $27,800, to our $8,400.
Like the Philippines, services account for the most substantial chunk of GDP at 79.1% against our 59.8%. In short, Greece is not an industrialized economy with industry contributing a mere 16.9%. We are better with the industry at 30.6%. However, that is a function of population and our local needs, i.e., OFW remittances and the BPO industry drive our income stream. We are over 100 million people, and they’re less than 11 million.
Democracy is hard work. Is that why we can’t move beyond OFW remittances and the BPO industry despite Arangkada?
A nation like Greece that is a service economy and not an industrialized one should be a lesson for us. Conversely, the Asian Tigers should be a lesson for us as well. See below re “match the world as it is.”
“Democracy is hard work and requires a lot from those who participate in it. It requires people to respect those with different views from theirs. [It] asks citizens to be able to sift through large amounts of information and process the good from the bad, the true from the false. It requires thoughtfulness, discipline, and logic.”
[Translation: Democracy demands skills that conventional wisdom had assigned to information technology, as in big data and analytics.]
The good news: “Human beings by nature readjust their ideas to match the world as it is and not as they’d like it to be—just as democracy requires.” [https://www.politico.com/magazine/story/2019/09/08/shawn-rosenberg-democracy-228045?cid=apn]
Does it apply to Juan de la Cruz? Can we adjust our ideas to match the world as it is and not as we like it to be? Recall Darwin.
Are we predisposed to deal with what is hard? Does “pwede na ‘yan” stand in the way like “que sera, sera”? Is dynamism in our bag of tricks? What about foresight?
Consider: We are parochial and insular. We value hierarchy and paternalism, rely on political patronage and oligarchy, that at the end of the day, ours is a culture of impunity.
“Why independence, if the slaves of today will be the tyrants of tomorrow? And that they will be such is not to be doubted, for he who submits to tyranny loves it.” [We are ruled by Rizal’s ‘tyrants of tomorrow,’ Editorial, The Manila Times, December 29, 2015]
“Now I know why Paul dared to speak of ‘the curse of the law’ (Galatians 3:13). Law reigns and discernment is unnecessary, which means there is little growth or change in such people. When you do not grow, you remain an infant.” [Faith and Science, Open to Change, Richard Rohr's Daily Meditation, October 23, 2017]
“As a major component for the education and reorientation of our people, mainstream media – their reporters, writers, photographers, columnists and editors – have an obligation to this country . . ." [Era of documented irrelevance: Mainstream media, critics and protesters, Homobono A. Adaza, The Manila Times, November 25, 2015]
“National prosperity is created, not inherited. It does not grow out of a country’s natural endowments, its labor pool, its interest rates, or its currency’s value, as classical economics insists . . . A nation’s competitiveness depends on the capacity of its industry to innovate and upgrade.” [The Competitive Advantage of Nations, Michael E. Porter, Harvard Business Review, March–April 1990]
“You have to have a dream, whether big or small. Then plan, focus, work hard and be very determined to achieve your goals.” [Henry Sy Sr., Chairman Emeritus and Founder, SM Group (1924 - 2019)]
“Learning and innovation go hand in hand. The arrogance of success is to think that what you did yesterday will be sufficient for tomorrow.” [William Pollard, 1911-1989, physicist-priest, Manhattan Project]
“Development [is informed by a people’s] worldview, cognitive capacity, values, moral development, self-identity, spirituality, and leadership . . .” [Frederic Laloux, Reinventing organizations, Nelson Parker, 2014]
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