EDITORIAL - Coalition for reforms

The story got buried in the crisis in Zamboanga City and the continuing interest in the pork barrel scandal. When the government has dealt with the conflict in Zamboanga, however, administration officials may want to look at the latest Philippine Development Report prepared by the World Bank.

 Administration officials will like the bank’s generally positive assessment of the current state of the nation. The report cites strong economic fundamentals, overall political stability and a President whose commitment to good governance has kept him popular midway through his six-year term.

 This positive environment can be enhanced, the World Bank suggested, through the creation of a broad coalition committed to institutionalizing reforms. The theme of the WB report is the creation of more and better jobs for inclusive growth and elimination of poverty. This is also a recurring theme in government programs, and the report is just the latest reminder to the administration of how much more must be accomplished, with just three years left in President Aquino’s term.

 The WB report is based on consultations over the past two years with various stakeholders. Most of the proposals echo what other groups, notably investors, have been suggesting for over a decade. The WB estimates that every year, the nation needs to create at least one million “good” jobs – meaning those that raise real wages and lift people out of the poverty line – to make a dent in social transformation. Agriculture and manufacturing, which can create those jobs especially in the low-income sector, have failed to grow significantly in the past decades, the WB noted.

 In 2012, an estimated three million Filipinos were unemployed while seven million were underemployed. Every year until 2016, approximately 1.15 million Filipinos are expected to be added to the labor force.

 The WB report cited a lack of competition in many sectors, complex regulations, insecurity of property rights and “severe underinvestment” by both the government and private sector.

 Several of the suggested reforms are not new. There are proposals to level the playing field for business, bring down power costs, and stimulate economic activity by fostering competition. International surveys on competitiveness and ease of doing business have raised similar issues. With just three years left, the administration must work double-time to lay the groundwork for long-term structural reforms.