President Noynoy Aquino’s 4th SONA: No transformative changes

President Benigno Aquino III addresses before the Congress, 22 July 2013.

President Benigno Aquino III addresses before the Congress, 22 July 2013. (Courtesy of Rappler)

President Benigno Aquino III delivered his State of the Nation address for the fourth time in his presidency. His SONA was significant in the first place as his administration is passing the midway of its term that is scheduled to end on 30 June 2016 and also, it was the opening of the new 16th Congress.

Since it is in the midpoint of his 6-year term, the people or boss in his own words, have been expecting a lot of transformative changes in our country for the past three years under his watch. Ordinary people may have different opinions in his policies, but there’s a common thing which is whether he delivered or not.

As I watched his State of the Nation Address at the Law Building of the University of San Carlos amidst of my asthmatic condition right now, there might be phrases that the president uttered that really made sense like saying that he cannot transform the country within his six-year term, which is impossible as far as our economic and political climate are concerned, but just like in his three previous SONAs, I cannot avoid to criticize his manner of blaming some of his shortcomings in his administration to his predecessor, Gloria Macapagal-Arroyo. I think for the past three years of his term, any shortcomings of his administration are now the fault of him and his team, not the predecessor one.

As I expected, he never mentioned any drastic and yet, long-term transformative changes for our country like revising our 1987 constitution to cure our economic and political systems shortfalls that are no longer compatible to our fast-evolving globalized world as he has to pander the interests of few business and political elites who brought his mother and him to the presidency. Though he mentioned some initiatives to be tacked in his administration like crafting a Basic Law for the proposed Bangamoro, amending the SSS pension scheme system, passing the Cabotage Law, Fiscal Incentives Rationalization Bill, Land Administration Reform Bill, P2.268-trillion National Budget for 2014, addressing chronic power shortage in Mindanao, dividing his family-owned Hacienda Luisita to beneficiaries by September, and many more, but those initiatives that the administration want to address are insufficient at its best to achieve of what he want, transformative changes.

What I would like to advise to our president is that he should capitalize his political advantage at this point of time to initiate structural changes to our economic and political system that would have positive impact to the lives of our future Filipinos and have him to stop listening leftist and oligarch lobbies of preserving the current status-quo that has not uplift the lives of our people from poverty while this people kept complaining whosoever in power and profiting the semi-monopolistic economic system thanks to the 1987 constitution. I hope the president will read and listen to my advice and if not, history will judge you.

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Problems with election-driven economic growth

Philippine GDP annual growth from 2001 to 2012. Notice the 3-year growth fluctuation during election seasons of 2004, 2007, and 2010.

Philippine GDP annual growth from 2001 to 2012. Notice the 3-year growth fluctuation during election seasons of 2004, 2007, and 2010.

The Philippine’s GDP during the previous quarter of this year, 2013, posted an annual growth of 7.8% from 6.5% of the same quarter in the previous year. The first quarter 2013 annual growth is the highest so far under the current government of President Benigno Aquino III. It is also the third consecutive quarter of more than 7% GDP annual growth.

The growth was unusually high due to construction and government spending (posted 33.7 and 13.2% growth respectively) during the first quarter of the year in relation to rush government infrastructure projects to be done before the election ban on construction of government infrastructures. The government has to stimulate this particular economic sector because electorates would like to ask projects from their respective local elected officials a project especially infrastructure and these elected officials would give in just to be reelected in their respective positions. During the first year of the current government of President Benigno Aquino, construction spending had almost collapsed due to insistence of his government to scrutinize any then-construction projects contracted during the previous government of President Gloria Macapagal Arroyo. When the president realized the economy cannot achieved their 7 -8% annual average GDP growth target until 2016, he resumed the massive infrastructure spending that has been done since the time of Gloria Macapagal Arroyo’s government to the extent that those projects that have been started by FPGMA, have been credited to the current president like the construction of the new airport in Cagayan de Oro, the Languindingan Airport, that was started its construction in 2006.

The growth was not balanced as usual as during the previous quarter, the exports of goods and services have had been registered with -8.4 and -2.1% respectively not because of lousy economic growth in Europe and the US or slowing economic growth in China, but because of our inability to expand our export markets to the other emerging markets like India, Russia, Latin America or even ASEAN and our inability to diversify our export products from mainly electronics to finished manufactured products like automobile, mobile phone, computers, construction equipment and others.

And let’s talk about the growth by industry, the growth was still unbalanced as usual as agriculture, fishing, and especially mining, lagged behind compared with the construction and financial intermediation which they posted 32.5 and 13.9% respectively while the first three sectors I’ve mentioned only posted 2.9, 5.5, and -17.0% during the previous quarter.

Mining registered the biggest contraction and its growth always fluctuate for many years due to erratic government regulations on mining like profit sharing with the government, Catholic Church and Communist Party-driven opposition on mining in Tampakan, Surigao, Nueva Vizcaya, and especially Palawan. This economic sector should be the prime driver of our economic growth as our country has untapped abundance of mineral, oil, and gas reserves that worth in all beyond trillions of dollars that need to be extracted for export and domestic consumption in order to build a viable manufacturing sector in our country and to assure economic independence from unsafe source of hydrocarbons like the Middle East and Russia.

In conclusion, we must not celebrate the growth but rather, we have to reflect that our economic growth right now, does not assure to have our people be uplifted from poverty, let alone to further generate wealth to create their own businesses to enrich further. Sustainable and inclusive economic growth cannot be measured on GDP growth alone, but can be measured through poverty reduction, unemployment decrease, stable manufacturing base, and secured energy sources.