By Rod Kapunan
Manila Standard Today
It is not for this column to throw brick at what the Aquino government is bragging as the rosy credit rating by Fitch from BB+ to BBB-. This we say because an increased credit rating is not the benchmark for economic resiliency, like the 6.6-percent growth rate in 2012 amid a weak economic backdrop. Rather, it was a clincher to make us believe this country is an exception. Fitch also cited as our strong points in what it termed as “the country’s strong external payment position, good inflation management, and fiscal consolidation efforts that kept the budget deficit in check.”
Reading between the lines about what may be described as the remaining colonial economy in Asia, it is difficult to comprehend how a credit rating could be translated to one of increased investments to create more jobs and more funds for social services to finally extricate us from the mire of economic backwardness. Fitch simply tells us we could borrow more to be mired deeper into that debt trap. It is has no bearing on this government’s paranoid claim of success.
The only true barometric indicator of success is when economic growth has helped reduce the incidence of poverty. As the saying goes, the economy is only good as when it trickles down to uplift the lives of the people. After all, it is they who will judge what a good or bad economy is. But as it is, a third of our population lives below the poverty threshold, and about 44 percent survive on less than $2 per day or P86. The average Filipino family, the report says, spends more than half of their income buying unprepared food items, while average American families spend only about 10 percent.
Even the statement praising the Aquino government for its “good inflation management,” it is not something for us to rejoice about. Inflation continues to plague the economy. Inflation was registered at 3.4 percent last month, and the easy translation is on how it affected the price of fuel with unleaded costing P54.90 per liter and P43.44 per liter for diesel. To remind this “matuwid na daan” government, the prices of fuel exceeded all previous administrations from the time that “magic of privatization and deregulation” of Ramos was made effective. We are saying this because the increase in the prices of goods and services is caused by unmanageable inflation resulting in the shrinking of the purchasing power of the wage earners.
The same can be said of that remark of having checked the budget deficit. How the government was able to do that remains a wonder. We are saying this because in 2012, the government posted a budget deficit of P235.3 billion or higher by 19 percent in 2011 at P197.8 billion. With an unprecedented budget of P2.006 trillion for 2013, or higher by 10.5 percent from that of 2012, it is again a wonder how the deficit could be managed or be balanced altogether before this government exits from power. But as the public sees it, the various collecting arms of the government are leaving no stone unturned in their desperate bid to scrounge every additional fund to sustain its bloated budget.
Most hilarious is the claim by Fitch of “a strong external payment position.” That in fact is a cue for the syndicated international creditors to allow this country additional loan. It is a go-signal for the political sycophants of this administration to get the filler for that big hole in their budget. Be that as it may, the Bureau of Treasury announced that as of July last year, government debt rose to P5.156 trillion. Of that P2.039 trillion, or 39 percent, is owed to foreign creditors, while P3.117 trillion or 60.45 percent to domestic creditors, and most was the result of the unmitigated issuance of government securities.
Good economic management necessarily results in the surge of foreign direct investment. It is not the credit rating by agencies like Fitch, Standard and Poor, and Moody’s that will save us. Often, they act as brokers for international banks and finance companies. In fact, it is a wonder how Fitch’s rosy rating was equated as something that could extricate us from that characterization of being the laggard economy in Asia when all it tells is that the window for us to borrow has been reopened.
But even on that, everybody knows no investor today would be willing to throw away his good money to open factories and provide more jobs to our people. They would rather invest in the casino economy for which we are noted, and fly out fast after earning their lucrative dividend, with the local but gullible investors as the usual victims. For the year 2011, the Philippines notched by mere hairline, Cambodia and Myanmar with $.8 billion and $1 billion, respectively, with the country registering a $1.3 billion in direct foreign investment. In 2012, the Philippines ended up at the bottom with $1.5 billion, and Cambodia $1.8 billion and Myanmar $1.9 billion finally surpassing us. The rest were able to scoop hefty FDIs as follows: Thailand $8.1 billion, Vietnam $8.4 billion, Indonesia $19.2 billion, Malaysia $10 billion, and Singapore $54.4 billion. We need not include China, Taiwan, Japan and South Korea for that would put us into absolute disrepute.
Finally, Social Weather Stations is telling us that 81 percent of Filipinos are satisfied with their lives. Even if we take it as biblical truth, the same self-styled survey outfit released last March 2012 stating that 55 percent of Filipino families rate themselves as mahirap, and hunger reaching 23.8 percent. The truth is no longer an issue, but logic because one must be afflicted with an acute case of psychosis to believe the great majority of our people are satisfied with their lives, unmindful that Wikipedia listed poverty in the Philippines on the same level as Haiti, a failed state right at the southern backdoor of the US.
rpkapunan@gmail.com
No comments:
Post a Comment