Are we still ranked as the country with the lowest cost of living in the world?

In 2005, the Philippines ranked as the country with the "lowest cost of living" in the world. This means that living in the Philippines is cheap and thus, it becomes a haven for foreigners to live here. Compared to living in America, Europe or Japan where housing, transportation, labor and commodities are so expensive, the Philippines is the very opposite. In fact, have you ever wondered why we have an influx of Koreans in this country? Well, as of 2006 Seoul, Korea ranks the third highest country that has very high cost of living. It has even bypassed Japan. So, aside from Koreans wanting to learn the English language in our country, they are also coming over to see whether they have good business opportunities in the Philippines.

There are also several reasons why foreigners or foreign companies seem to always look into the Philippines (if not come back) for retirement or to set up businesses despite the fact that they usually find difficulty in our government’s "red tape" and policies.

As I was browsing thru the net I found a company named Phil American Global Solutions, Inc. owned and managed by American executives living in the Philippines. This company has summarized the advantages of setting up a business in the Philippines – they are as follows:

The Philippines is emerging as a preferred offshore alternative to India, due to historical and cultural factors of its people and the legal system. Laws are patterned after the United States laws. Furthermore, the Philippines is one of the countries in Asia to enact an E-Commerce Law. Our high levels of proficiency in English make us have a unique edge over other countries in Asia or South America. Our educational system (as much as we complain about its poor quality) is patterned after American schools. American English is used from kindergarten to college as a medium of instruction.

We are the world’s richest source of English-proficient professionals (yet we laugh at our Pinoy brothers with heavy accents) proven by many global companies to be highly skilled, productive and adaptable at a savings of 40 percent to 70 percent over similar American services. The cost of labor (especially in the provinces) is near the lowest in the world.

The Philippines is very strategic in terms of time zone since we have a12- to 16-hour time zone difference with North America that facilitates 24-hour processing. Outsourcing providers include Call Centers, Back Office Processes, Financial Management and Accounting, Medical and Legal Transcription, Website Development, Custom Software Development, and Computer Aided Design (CAD) services. At present, we have more than 8,000 companies outsource IT based work here (to the Philippines) including Microsoft, IBM, America Online, Accenture, Barnes and Noble, Caltex, Citibank, Fluor Daniel, Elsevier Science, Blackwell Science, Manulife, Morgan Stanley, Northwest Airlines, Procter and Gamble, AIG, International Red Cross, AlItalia, Great Plains Software, Fujitsu, Headstrong, NEC, Simteria, Trend Micro Labs, and People Support.

Our country also boasts of its artistic and talented video graphics experts who create cartoons and animated computer graphics for companies such as Flinstones, Hanna Barbera, Disney, Atlantis, Cartoon Network, and Iron Giant.

We have the best location as the Pacific gateway for international cargo shippers like UPS, FedEx and DHL. We also have world-class telecommunications and internet equipment, along with other business facilities left by the US military at Subic Bay Naval Base and Clark Air Force Base. The liberalization of telecommunications infrastructure paved the way for affordable cost of internet access and similar communication facilities.

Our country (despite the controls many feel from the Arroyo Government) is still considered very democratic and the most liberal in terms of freedom, especially media freedom in Asia.

In 2005, the Philippines had the lowest cost of living in the world and expatriates say that the quality of life in our country makes it the best place to live in Asia. Our people are very friendly and hospitable.

Sure, it is important to know all the good points we have as a country. These are wonderful advantages we have over other neighboring countries which spell out big opportunities for advancement and development. However, there is one thing we have neglected and this is the dignity of our workers. The Filipino is a good, dedicated, loyal and industrious worker. We must preserve his right to live a good and comfortable life. Right now, a minimum wage earner cannot even afford to live in our country. His wage has not equaled the "real" value equal to the cost of living. The current minimum wage for Metro Manila (as of 2006) is P7,800 plus P1,300 for ECOLA, a total of P9,100 per month. Then, you have to subtract Social Security, PhilHealth and taxes (including E-VAT) – what is left for the worker who still has a family to feed? His income is not even enough to support his family not to mention the subsistence of his own personal needs. This is why crime cannot be resolved – corruption, stealing, kidnapping, etc. exists in our society. The minimum wage earner cannot even live in a decent house. What a pity!

We need to strike a balance to regulate the cost of living and to increase the take home pay of workers. At the same time, analyze how businesses will not suffer or close down as wages are increased in a fair manner. The Business Community must not only think of "profit" but also of the Filipino worker who needs to live a comfortable, decent and respectable life.

President Gloria Macapagal-Arroyo was valedictorian of her high school class at Assumption Convent. She was consistently on the Dean’s List in Georgetown University in Washington DC, and graduated magna cum laude at Assumption College. She obtained a Master’s degree in Economics from the Ateneo de Manila University and a doctorate degree in Economics from the University of the Philippines. With her strong background in the field of Economics, let this problem be her challenge. No president of the Philippines has ever resolved this "lurking" problem. If she is able to find a solution, many will be happy. This would be her strongest "campaign" for the coming elections or the best legacy she would leave to the Filipinos.