By Ray L. Junia, Publisher
THIEVES continue to steal the future of this country.
Nothing can be more unreal than the government claim of economic gains trumpeted by Malacañang spin masters as the best in our part of the world.
The latest gesture of courtesy by an honored guest to his host, a World Bank top official saying the Philippines is on its way to become Asia’s economic tiger, made the headlines in our national media. This made us laugh. This WB seer is either the worst prophet or best in PR that envoys are trained to be.
Motoo Konishi, WB country director for the Philippines, cited macroeconomic strength of the economy for his trust in our future. He fails to see the sick trees inside what appears to be a beautiful forest. This is unfortunate as we expect bankers to be more forthright and honest and if they cannot be honest they better just shut up.
The Philippines is doomed to become tail ender in the race for economic gains in Asia if not the world. It is our destiny to be always poor. We have our reasons to believe so.
Corruption is the root cause of the country’s economic miseries. Cost of living, driven by high cost of basic necessities, is too high, seventy percent of the population has been declared poor.
Stealing from government coffers has not abated, even got worse with the President illegally spending Php177 Billion on DAP from the national budget. To think that other agencies are victims of the same thievery that ultimately ends up with the people suffering.
This thievery and corruption is the first reason responsible investors are not coming in and may even be packing up.
Latest report from the Philippine Statistics Authority on the foreign investments (FI) shows a sharp decline in the first quarter of 2014 compared to same period last year.
In the first quarter of 2014, FIs approved by seven investment promotion agencies amounted to Php37.4 Billion. This is 25.6 percent lower than the take in the same period last year. In 2013, FIs were Php50.3 Billion.
FDIs tell the story
On foreign direct investments (FDI), the Philippines is the tail ender, far way below the second lowest.
The average take by the country on FDIs between 2002 and 2012 was US$2.7Billion, the lowest while Singapore, a city state, got the highest at US$52.8Billion. Vietnam got second lowest with US$8.5B, better by over US$5B.
Even the numbers on FDIs in relation to the Gross Domestic Product (GDP) can cause investors to shy away from us. In the first two years of the Aquino administration, we registered again the lowest in ASEAN countries.
In 2010, net FDI was 0.7 percent of GDP and this declined to 0.6 percent in the following year, 2011. Compared with neighbor countries our net FDI was the worst and almost sick situation. Our neighbors did much better: Singapore 25.1%, Vietnam 6.2%, Malaysia 4.3%, Thailand 2.8% and Indonesia 2.2%.
In the measure of impact of the FDI to population or per capita shares, it will tell a clearer picture of the cause of our economic woes. On this measure, our FDI per capita is lowest at US$ 13.3 while Singapore registered the highest at US$ 12,347.00.
These figures covering the period ended 2011. Three years after, when poverty incidence has gone up and prices of basic goods and services have hit the ceiling, this situation could be lot worse.
The first look at our numbers will not encourage serious investors to come in. discouragement will set in when they find out why we are the cellar. The reason is massive corruption that has worsened during the Aquino administration.
It’s corruption, stupid!
Pulling down interest and trust by foreign investors in our country and national leadership are several reasons: high cost of electricity, lack of infrastructure and worsening peace and order and corruption.
While corruption is last in the list of reasons, it is the principal cause of reasons the country is losing the trust of investors.
The cost of electricity in the Philippines being highest in Asia and second highest in the world can be traced to massive corruption in the highest offices of the land, from Malacañang to Congress, down to the Energy Regulatory Commission (ERC).
On infrastructure, the national leadership has turned over this responsibility to the private sector. From supply of power, to supply of water, to use of roads, to building of transport, and airports, these are all now being given out to private investors.
Our national leaders call this Public-Private Partnership or PPP. This is one marriage that was intended to legitimize rape.
How else would one describe a situation like what the Filipinos are going through now. Before privatization, cost of electricity was one of the lowest in Asia, roads were free to use, cost of water was affordable and cost of living allowed free money to spend outside of the essentials.
The national economy is now controlled by forty families. Eighty percent of national wealth is owned by 10 percent of the population. Ninety percent share the remaining 20 percent of national wealth. This situation has led to daily “rape” of every poor Filipino’s right to a decent living.
Now we have to pay for use of highways we call toll roads. The national leadership intentionally stopped building big roads to the big city to justify entry of toll roads.
What happened to cost of electricity and cost in use of roads are examples of well planned grand robbery. Government neglected building new power stations while neglecting national roads, stirring consumers to demand for better services. Privatization became the only solution, offering lower cost that never happened and, worse, cost doubled if not tripled.
Government leaders said privatization saves the government of funding services that are obligations of government. These government duties are supposed to be supported by our taxes. This cost transfer led to savings that allowed Malacañang to “steal” Php177 Billion for DAP and tens of billions for PDAF.
Theft came from many points: at the privatization arrangement when investors would show interest and put his money where his mouth is. Second, at the national budget that would have been spent for these basic services given to the private group. This savings turns out be pork barrel of Malacañang, in the case of Aquino is Php177 Billion in two years, misappropriated and misspent.
Even when privatization became a solution to our infrastructure needs, still serious investors are saying the country is short of what are needed to gain their trust.
One leading complaint is our problem in communications. Even when Smart earns billions of pesos for Manny V. Pangilinan and Globe has multiplied several folds the billions of the Ayalas, the foreign groups are not still happy with our communications system.
Truth is not only the foreign investors are complaining but the locales are also complaining of being short changed by these telecom companies.
Privatization not free
Privatization is not free to the taxpayers. In 2012, President Aquino gave the DOTC Php8.6 Billion and the DPWH Php3 Billion for the preparation of business cases, pre-feasibility studies and feasibility studies for various PPP ventures.
In inviting private sector participation, the government waives many requirements that would have earned the national treasury billions of pesos. Of course these exemptions are always suspect to be products of under-the-table negotiations that line up the pockets of government executives and legislators.
The sum total of reasons this country will not move forward and bring economic relief to the poor is we have elected officials who serve the interests of their masters and not the interests of the people. We have national leaders who boldly steal, unmindful of constitution and laws, as if the public does not exist.
The “theft” of Php177 billion by Malacañang is just a symptom of a more serious malady. The effect of this disease is a society that will always be abused and used to enrich further enrich the billionaires and make new millionaires of those we trust to lead our government. This is because we have elected thieves to run our government.