A WEEK after President Benigno Aquino III delivered his last State of the Nation Address (SONA) last July 28, economists from Ateneo Eagle Watch, an organization that aims to brief the public on the Philippines’ economic landscape, hosted a mid-year briefing at the Ateneo Professional Schools in Makati to assess the accomplishments of the Aquino administration.
Economics Department Professor Joseph Lim, PhD presented statistics to compare with the data given in Aquino’s SONA and to analyze the economic climate throughout his administration. Alvin Ang, PhD, also an Economics professor, provided a market forecast and expectations for the upcoming year. On the other hand, Rappler Editor-at-Large Marites Vitug discussed possible scenarios for the upcoming elections.
Poverty incidence
Lim noted that in the 2014 SONA, Aquino announced that poverty incidence decreased from 27.9% in 2012 to 24.9% in 2013. However, Lim dismissed this because it used previous data from the year’s first semester. Although the president had claimed to reach the poverty reduction goal, poverty rate increased again in 2014, missing the target goal.
The government’s anti-poverty program, Conditional Cash Transfer (CCT) or the Pantawid Pamilyang Pilipino Program, is one of the means to address poverty in the country. Lim cited that its beneficiaries increased from 760,000 families in 2010 to 4.4 million households in March 2015. He recognized the program’s promotion of education and skills development to keep children in school and eradicate child labor. It also encourages mothers to avail of maternal healthcare, resulting in healthier children.
However, Lim questioned why the government has not made a dent in the poverty rate. “Just on the logic of it, the cash subsidies should have reduced poverty immediately, but there are no data to prove this,” he said.
Social services
Lim raised his doubts on Aquino’s claim that the healthcare of the country’s “poorest two tiers” were covered under the PhilHealth Universal Program.
He explained that profit-oriented health providers result in low-income groups not included in the program paying more for healthcare. Preventive healthcare, such as immunity programs, and food safety assurance are other areas that Lim believes are not being addressed.
As for education, Lim observed that Aquino has only spoken about the increase of textbooks, classrooms and other resources, but not of the quality of education and vocational training. He stated that this is a key indicator of distinguishing “successful developing countries from unsuccessful ones.”
Sustainable growth
Overall, the economy is at an “upward slope” under Aquino, with the growth of its gross domestic product higher than past administrations.
Lim attributed this growth to improvement in governance, specifically in investor confidence and fiscal balances as there are “no more scandals like the ones under [former president Gloria Macapagal-Arroyo].”
Ang pointed out the economy’s fiscal position, identifying the big difference between government and revenue expenditures. “The falling deficit is not a good scenario because you want expenditures to be converted to economic growth,” he stated. “Something has to move the private sector.”
With speculation that the US will raise interest rates, Ang predicted that the peso would depreciate to around Php 45.50. He said that the stock market should not grow more than a “healthy 10%” in order to “correct” the decrease in peso value.
Ang also noted that the stock market now includes local and foreign traders, “giving us half the leverage” to buy the stock market and encouraging local support so as not to be entirely dependent on foreign sentiments.
According to Lim, the economy remained resilient and stable despite its drawbacks, providing insights on the nature of growth under Aquino. However, he believed the economy would not fare well in a global perspective.
“Economic confidence cannot be sustained without hard work and winning the masses,” Lim explained. “We are now being socially divided due to who the next president will be.”
2016 elections
Vitug summarized the most urgent national concerns according to a March 2015 Pulse Asia Survey: Fighting graft and corruption, poverty and crime reduction, job generation, improving wages, and controlling inflation.
For the succeeding administration, she said structural and institutional reforms have to be implemented in order to broaden the middle class, embed transparency and accountability in government institutions, as well as end internal rebellions.
“It’s critical that the next president possesses certain qualities to be able to address these very difficult challenges,” she shared. The next president should be a strategic thinker and committed to common good, she says, but also have a strong sense of “fair play” and executive skills.
She assessed the issues surrounding presidential contenders, claiming citizenship and lack of experience as Grace Poe’s primary hindrances. Mar Roxas, on the other hand, faces criticism as an ineffective crisis manager because of the lack of promptness in leading post-Yolanda rehabilitation.
“He’s a leader in ‘normal time’ but [this] is difficult in the Philippine context,” she stressed.
Meanwhile, Jejomar Binay and his family are faced with plunder charges and for forming a political dynasty. Despite claims of human rights violations and “vigilante killings”, Rodrigo Duterte is known for his “iron fist” which Vitug shared has made Davao one of the safest cities in the country.
Continuing the “daang matuwid”
Lim highlighted the need for good governance that is “performance-based with a heart” in order to continue reforms and aspire for inclusive growth. He said platforms should not only be determined to end corruption, but also aim for institutionalizing required economic planning.
“We don’t just need ‘hardware’, physical infrastructure and human capital, we need the ‘software’, which [are] institution and direction-giving in the government,” he stated.
Vitug posed the question of who the next leader will be, and if he or she will be able to continue and improve on what the Aquino administration had started. She seconded Lim’s sentiments on government proficiency: “It’s not just daang matuwid [straight path], but also daang magaling [competent path] (It’s not just about taking the straight path, but also about following the competent path).”
