Do we see “green shoots” out of the BOI?

“We develop exports through FDI, not internally. Look at Vietnam. Look at Thailand. Factories put up by foreign investors produce the export products coming from our neighboring countries. It could be our country eventually (that can serve) as the production base for our export market, Trade Secretary Alfredo E. Pascual said.

“The pandemic disruptions in China and the Russia-Ukraine war have roiled global supply chains, leading many manufacturers to reconsider their options in choosing an Asian base of operations.

“Mr. Pascual said foreign investors will help provide the Philippines with technology, capital, and new markets.

“The foreign investors we are trying to attract here have a built-in market and already have the technology. It is a matter of setting up the factory here and employing our people. That’s the approach that I am pushing. We integrate trade, industry, and investment,” Mr. Pascual said.” [“Foreign investors’ choice of Asian manufacturing base seen as critical for PHL export prospects,” Revin Mikhael D. Ochave, BusinessWorld, 8th Jan 2023]

Let’s hold it right there.

Recall the force field theory in managing change: (a) exploit the driving forces and (b) right the restraining ones. And green shoots can blossom into driving forces, meaning the Philippine elite and chattering classes must step up to the plate.

Recall that preeminent economist Ciel Habito raised the crux of our challenge. Our export revenues are a mere fraction compared to our neighbors.

Recall, too, that media pillars Boo Chanco and Tony Lopez broke the initiative of tycoon Ramon Ang to develop Bulacan beyond the Bulacan airport, mirror the Pearl River Delta Economic Zone, and generate incremental exports of $200 billion. That will match the performance of our neighbors.

If we want to internalize the power of the force field theory, we may want to pause and ponder that we see a trifecta in front of us, courtesy of Messrs. Pascual, Habito, and Ang.

Consider that we have paid lip service to the mantra: Create jobs to address poverty and “inclusion.” The private sector expresses it as “the fiscal side of the enterprise is not the driver of the enterprise.”

For the enterprise we call the Philippines, we must learn to think outside the box and embrace forward-, lateral, and creative thinking. And toss the fixed mindset that has defined our approach to economic development — and nation-building.

Said differently, we can’t embrace “insanity” lest we sink deeper into the abyss.

Back in 2015, we thought we saw green shoots. But the blog was skeptical. A quote from the posting eight years ago: “We cannot assess manufacturing’s potential by simply assuming FDIs will move from China to PHL. We need to focus on where the most significant bang is and understand the competitive drivers. For example, Japanese manufacturers that left China chose Indonesia over PHL.”

In other words, the blog has raised the challenge of reinventing Juan de la Cruz since its inception 14 years ago.

Why? Because “change” is not a walk in the park. There is no free lunch. It takes “self-governance” for a nation like ours to overcome our instincts. We are parochial and insular. We value hierarchy and paternalism and rely on political patronage and oligarchy; ours is a culture of impunity.

And we are being true to form, “In the most impoverished countries, there will be less support for social change in a country that arguably needs it the most. It explains the “system justification theory.”

Let’s hold it right there and drill down on “self-government.”

“The Pilgrims knew they had to do something quickly; otherwise, every man, woman, and family would be for themselves. While still on board the ship, a group of 41 men signed the Mayflower Compact, in which they agreed to join together in a “civil body politic.” This document would become the foundation of the new colony’s government. Signed on 11th Nov 1620, the Mayflower Compact was the first document to establish self-government in the New World.” [History.com]

The crab mentality is the human condition. And worse, governments can be corrupt.

“Self-governance is also associated with political contexts in which a population or demographic becomes independent from colonial rule, absolute government, absolute monarchy, or any government they perceive does not adequately represent them.

“Henry David Thoreau was a major proponent of self-rule in place of “immoral” governments.

“In ancient Greek philosophy, Plato posits the concept of self-mastery as the ability to be one’s master; he states that individuals or groups cannot achieve freedom unless they govern their pleasures and desires and instead will be in a state of enslavement.

“John Locke furthers this principle in that genuine freedom requires cognitive self-discipline and self-government and that man’s capacity for this is the source of all “freedom.”

“In this sense, freedom is not a possession but an action. Locke proposes that rationality is the key to true agency and autonomy and that political governance is the outcome of governing one’s judgment. His political philosophy was a prominent influence on Immanuel Kant and was later taken up in part by the United States Founding Fathers.” [Wikipedia]

Freedom is beyond one’s rights. It is not a possession but an action.

In other words, we must toss the Philippine caste system and the value of hierarchy and paternalism. Privileges and entitlements aren’t the given. We can’t be both Juan Tamad and Bondying rolled into one.

Mr. Pascual has his job cut out for him. Recall that the blog often discusses “horizontal leadership” as an expression of “self-governance.” He must now engage both the public and private sectors to edify them that, as demonstrated by our neighbors, rapid economic development cum nation-building is a reality and not a pipe dream.

“We integrate trade, industry, and investment.” If by that we mean we must create the requisite ecosystem to drive rapid economic development, then we are on the right track.

Again, from an earlier posting: “Ramon Ang’s Bulacan initiative, beyond the Bulacan airport, must mirror the Pearl River Delta Economic Zone ecosystem and generate “incremental” exports of $200 billion. That will pave the way for the Philippines to match the export revenues of our neighbors. And which is how Vietnam eliminated poverty.

“As the blog has raised, the BOI must be in the crosshairs to assume this challenge and toss our historical models in crafting investment incentives. 

“We have over 400 export processing zones under the PEZA. Yet, we generate the most negligible export revenues. How many more export processing zones are we contemplating, given the NEDA 5-year development plan?

“Sadly, we can’t wrap our heads around Pareto and distinguish the “vital few” from the “trivial many.

“What do we keep missing? We’re stuck with addressing jobs, poverty, and inclusion and pursuing quantitative tools but no forward, lateral, and creative thinking.

“We have no experience designing and assembling the requisite “ecosystem” to equip us to navigate the journey from poverty to prosperity. Moreover, as we take for granted our caste system, we won’t slay the dragon of political patronage and oligarchy.”

The good news is that Mr. Pascual is upending our inherent inward-looking bias, “We develop exports through FDI, not internally. Look at Vietnam. Look at Thailand.”

Recall that the blog distinguishes (a) logical yet linear and incremental thinking and (b) forward, lateral, and creative thinking.

It will not be easy for Juan de la Cruz to upend our caste system. Moreover, we carry much baggage from the past.

And here is where Maslow’s hierarchy of needs comes in – from physiological to self-actualization. And it is the bedrock of innovation.

Yet, we won’t embrace innovation and global competitiveness if we can’t embrace forward thinking.

Recall how I explained freedom, democracy, and the free market to my Eastern European friends. They are not about rules but principles.

Even the wife wondered how these people could move forward: What are we doing in this godforsaken place?

Answer: We are a subset of this dynamic universe in constant motion and expansion.

“Like Europeans, the eastern woodland Indians of North America engaged in near-constant fighting during the centuries before first contact. Native American warfare differed dramatically from European hostilities regarding its roots, aims, and nature.

“Old World wars of the fifteenth and sixteenth centuries, such as the Spanish Reconquista or the Hapsburg-Valois Wars, were costly, large-scale affairs. They had religious or dynastic origins, produced comparatively high casualties, and fought to achieve territorial or economic gains.

“Indians fought these wars for several reasons. First, blood feuds were a way for Native Americans to avenge the deaths of kin or tribe members murdered by other Indians. Second, mourning wars gave young men the opportunity to earn the prestige needed to become respected and influential members of their tribe. Third, taking captives satisfied demographic needs by providing a source of replacements for a tribe's deceased members. Fourth, mourning wars fulfilled a spiritual and psychological function by easing grief, providing a means for coping with death, and restoring to the community the spiritual strength believed lost through the death of a clan member. Finally, blood feuds provided a steady source of captives for some Native Americans’ ritual sacrifices.” [Native American Warfare in the East: Mourning Wars | Encyclopedia.com]

“The first European colonization wave began with Castilian and Portuguese conquests and explorations and primarily involved the European colonization of the Americas, though it also included the establishment of European colonies in India and Maritime Southeast Asia.

“During this period, European interests in Africa primarily focused on establishing trading posts there, particularly for the African slave trade. The wave ended with the British annexation of the Kingdom of Kandy in 1815; and the founding of Singapore in 1819.

“The period in which much of the first wave of European colonization (and other exploratory ventures) occurred is often labeled the Age of Discovery.

“A later primary phase of European colonization, which started in the late 19th century and primarily focused on Africa and Asia, is known as the period of New Imperialism.

“Religious zeal played a large role in Spanish and Portuguese overseas activities. While the Pope was a political power, the Church also sent missionaries to convert the indigenous peoples of other continents to the Catholic faith. Thus, the 1455 Papal Bull Romanus Pontifex granted the Portuguese all lands behind Cape Bojador and allowed them to reduce pagans and other “enemies of Christ” to perpetual slavery.” [Wikipedia]

In other words, the Christian faith we proudly embrace is the other side – of the coin – known as New Imperialism.

But then again, we are a subset of this dynamic universe in constant motion and expansion.

“Most tribal wars were fought for the essential resources: goods, territory, and women. These reproduction-enhancing resources prompted our ancestors to fight to pass down their family genes. According to a new study, an exciting pattern occurred with war as a driving force for survival.

“People with certain warrior-like traits were more likely to engage in and win “wars” and then pass their warrior genes down to their children, which – on an evolutionary timescale – made their tribe even more warrior-like. In short, humans seem to have become more aggressive over time due to war’s essential benefits.

“In their study, Stanford University scientists Laurent Lehmann and Marcus Feldman have presented a model showing that aggressive traits in males may have evolved as an adaptation to limited reproductive resources. Because tribal war serves as a method for appropriating territory and women, war may have driven the evolution of these traits.

“The scientists use the term “belligerence” to refer to a trait that increases the probability that the person’s tribe will attack another tribe. Likewise, “bravery” refers to a trait that increases the probability that the person’s tribe will win a war.

“Lehmann and Feldman demonstrate in their model that belligerence and bravery continue to evolve through the male line genetically. When one tribe conquers another, males in the conquering group mate with females in the conquered group and pass the warrior traits to their male offspring.” [Tribal war drove human evolution of aggression (phys.org)]

In other words, if there is a hierarchy of human needs, humankind also evolved – will continue to “evolve.”

Recall that the blog distinguishes (a) logical yet linear and incremental thinking and (b) forward, lateral, and creative thinking.

Do we see “green shoots” out of the BOI?

“We develop exports through FDI, not internally. Look at Vietnam. Look at Thailand. Factories put up by foreign investors produce the export products coming from our neighboring countries. It could be our country eventually (that can serve) as the production base for our export market, Trade Secretary Alfredo E. Pascual said.

Mr. Pascual has his job cut out for him. Recall that the blog often discusses “horizontal leadership” as an expression of “self-governance.” He must now engage both the public and private sectors to edify them that, as demonstrated by our neighbors, rapid economic development cum nation-building is a reality and not a pipe dream.

“We integrate trade, industry, and investment.” If by that we mean we must create the requisite ecosystem to drive rapid economic development, then we are on the right track.

In other words, we must toss the Philippine caste system and the value of hierarchy and paternalism. Privileges and entitlements aren’t the given. We can’t be both Juan Tamad and Bondying rolled into one.

It will not be easy for Juan de la Cruz to upend our caste system. Moreover, we carry much baggage from the past. See above; humankind has evolved – and will continue to “evolve.”

History must equip us to navigate the future, not turn back the hands of time.

And here is where Maslow’s hierarchy of needs comes in — from physiological to self-actualization. And it is the bedrock of innovation.

Yet, we won’t embrace innovation and global competitiveness if we can’t embrace forward thinking.

Gising bayan!