Rising on merit

Back in the days when the Philippines was seen as one of Asia’s most dynamic economies, the Asian Development Bank (ADB) decided to set up its headquarters in Pasig.

The ADB complex was built by South Korea’s Hyundai Construction, whose CEO at the time was a former student leader who spent five months in jail for leading student protests against the dictatorial regime of Park Chung-hee.

The student, Lee Myung-bak, clawed his way out of South Korea’s humiliating colonial era and post-war poverty, selling fruits to finish high school at night and then hauling garbage to pay his way through business school.

After university graduation and jail time, Lee’s competence and hard work as a salaryman impressed the owners of Hyundai enough to make them name him CEO, at 37 years old, of what is now one of Korea’s largest conglomerates.

Yesterday Lee arrived in Manila as an official guest of the Philippine government. The poor boy from Pohang is at the pinnacle of his post-Hyundai career, proud to be president of South Korea.

It’s a long way from his teenage days of collapsing from hunger. “Poverty clung to my family like a leech, and it would be many years before we were able to free ourselves from its miserable grip,” Lee wrote in his autobiography, translated into English. “All we had back then was a desperate yearning to live a better life and a fierce sense of urgency. And this is what allowed us to do what many considered impossible.”

Lee is a good example of what can be achieved through hard work, determination, and of course innate gifts, in a merit-based society where the distribution of wealth is generally equitable compared with many other countries. Korean Ambassador Lee Hye-min is proud to call 21^st century South Korea “a classless society” – a place with no exclusive gated villages to keep out the riffraff, and where everyone is given the opportunity to realize one’s full potential.

President Lee is also a reminder of how much South Korea has achieved, and how far the Philippines has lagged behind its Asian neighbors, since Hyundai Construction built the ADB headquarters.

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Today Hyundai is heavily into shipping, although it is best known in the Philippines for its motor vehicles. Korean cars and consumer electronics are competing with the best in the world. Samsung is taking on Apple’s iPad and iPhone. Seoul Incheon International Airport has won several awards as the world’s best.

We, on the other hand, have not graduated from making gaudy, polluting knockoffs of the Jeep. And our airport is… never mind.

Our country is not lacking in brains and talent, but many of our best minds are working overseas for foreign companies, frustrated that most of those who prosper in this country are those with the right surnames or connections. When the accident of birth plays a critical role in financial or professional success, there is little incentive to strive for excellence and genuine self-improvement.

Wars, struggles for independence, and even dictatorships triggered social upheavals in several Asian countries that ended the stranglehold of the elite on power and wealth. Today the once powerful monarchies of Asia play a largely ceremonial or symbolic role in their respective countries, with the exception of Thailand, where the ailing but still beloved King plays a key role in national unity.

Uncle Sam hastened this process for Japan after World War II, but didn’t do something similar to narrow the yawning class divisions in the Philippines, where the cooperation of the elite allowed the perpetuation of US colonial rule. That elite remained firmly entrenched when the Americans fully turned over the reins of government to Filipinos after the war.

Our country has failed to realize what much of Asia perceived as a huge potential for Philippine prosperity. It has lost its appeal as an Asian hub, whether for airlines or Federal Express or the headquarters of the Association of Southeast Asian Nations, which picked Jakarta.

Ferdinand Marcos managed to initiate land reform under authoritarian rule, and could have done more to compel a more equitable distribution of wealth. Instead he created a new elite class and made patronage even more entrenched to perpetuate himself and his cronies in power.

In his compelling autobiography, titled “The Uncharted Path,” President Lee mentions his experience in doing business in the Philippines during his Hyundai days. “Marcos and Imelda” warranted special mention as Lee related how Hyundai competed with Japan’s Marubeni for a $150-million power line project about a year before the Marcoses were ousted.

“When the first-round results came in for the power line project, Hyundai came in first, while Marubeni came in second. Hyundai was working with a figure who had direct access to President Marcos, whereas Marubeni was working with someone belonging to the Imelda faction. And both sides knew what the other was up to at all times. Back then, anyone could ‘buy’ government documents for a small fee,” Lee wrote.

When Hyundai eventually lost to Marubeni, Lee said he asked their agent what happened. The answer: “Marcos lost to Imelda. It’s as simple as that.”

Lee was later impressed by Corazon Aquino, at a reception Hyundai hosted to commemorate the opening of the ADB headquarters. He was also impressed by her military chief at the time, Fidel Ramos, who noted that during the Korean War, Korea’s per capita income was just $60 and the Philippines’ was $700. Korea soon overtook the Philippines, and Ramos blamed it, Lee wrote, on “bad leadership.”

Today the Philippines relies on foreign aid, with Seoul providing a soft loan of $500 million in the next three years on top of its annual development aid.

Koreans seem to like the Philippines, despite all the problems. About 740,000 Korean tourists visited the country in 2010 – the largest from a single country – with the number expected to hit a million this year. South Korea accounts for the third largest foreign investments here and is our fifth largest trading partner ($10 billion last year).

It’s good to be liked, and it’s good to have friends who are willing to help, but it’s best if we could catch up with all the neighbors that have left us behind. We’re a long way from catching up with South Korea, now the world’s 13^th largest economy despite its conflict with its northern neighbor.

“Our finest hour is still ahead of us,” Lee wrote in his book, addressing Koreans. We should be able to declare the same, and make it happen.