Economy

Filipinos might be sentimental voters. But in their heart of hearts, it is the economy that matters.

In the most recent voter attitude polls, it is clear our people are primarily concerned with low wages, high prices and rampant corruption. If the candidates address what is topmost in the people’s mind, the forthcoming presidential campaign should revolve around who offers the best economic policy package.

For a while, though, it seemed that the trend towards another round of “necro-politics” was inevitable. Recall that in 2010, the presidential contest was driven by sympathy votes after democracy icon Cory Aquino died. People voted her son president, forgetting to interrogate his competence for the job.

Grace Poe’s dramatic rise to the top of the popularity charts has been, no doubt, driven by a strong undercurrent of sympathy for her late father. For a while, it seemed inappropriate to ask the difficult questions: What prepares her for the job? What record of achievement does she stand on?

Now Leni Robredo has been dragged into the fray by insistent LP demand. Her most important asset, needless to say, is being married to Jessie Robredo, the man who perished in a plane crash.

Jessie Robredo’s image has been embellished by the LP propaganda machine and by an administration that probably regrets not treating him well enough when he was alive. His virtues have been extolled and his faults airbrushed away.

But this much can be fairly said of Jessie: he was an exemplary local official. That hardly makes it imperative to vote his wife to a post that is a mere heartbeat from the presidency.

The sooner we step back from our penchant for “necro-politics,” the better we might appreciate what is truly at stake in the looming presidential contest. What is at stake is our nation’s economic future, now imperiled by the acts of omission of this administration.

Noynoy Aquino lulls us with his boasting. He keeps repeating the mantra that foreign direct investments increased dramatically during his watch.

He conveniently leaves off the other half of the investment equation: that investment flows to the region increased dramatically during the period of “quantitative easing” after the 2008 global financial crisis. The Philippines’ received only a tiny fraction of those investment flows.

In the first half of this year, direct investments dropped dramatically. At the same time, Filipino conglomerates began investing in large projects abroad, effectively exporting local capital and knowhow.

The reason for this is that the business environment locally has deteriorated. Comparatively, there is less reason to invest here than elsewhere. Energy is expensive, red tape is maddening, taxes are high and policies are primitive. That is not even talking about the poor infra, the corrupt and incompetent bureaucrats and the impossible traffic situation.

The next president, to save the nation, should break this cycle.

Partnerships

This week, the Joint Foreign Chambers (JFC) called on all the presidential aspirants to state clearly their economic programs. They want to hear the candidates outline their proposed policies that will modernize the country’s infrastructure backbone, open up the economy to trade and investments and eliminate red tape and corruption.

The JFC is composed of all the foreign chambers of commerce in the country. It has been, in turn, part of a larger congregation of business groups that annually submitted to President Aquino their desired action plans. Those proposals have, in the main, been ignored.

Consequently, the business community has been an exasperated lot. They see opportunities pass us because of ineptitude at the very top.

Only recently, the business groups joined in chorus with the trade unions and the professional associations in demanding that tax rates be adjusted to inflation. The proposal would bring quick relief to a middle class threatened with extinction and improve the demand side of a flagging economy.

That proposal for tax reform was flatly rejected by Aquino no less. His callous attitude was echoed by his preferred successor Mar Roxas.

Two large initiatives will shape the countries of East Asia and the Pacific Rim in the coming decades. Neither initiative includes the Philippines.

Last week, 12 countries led by the US and Japan formally inaugurated the Trans-Pacific Partnership (TPP). This free trade deal is much like the ASEAN Free Trade Area (AFTA) and the North American Free Trade Area (NAFTA), only larger. The original 12 incorporating economies account for over 40 percent of the global economy.

For some reason, perhaps because our policymakers are inept or our policy framework primeval, the Philippines has not been invited to this partnership.

The other large initiative is the establishment of an international infrastructure bank. This initiative is being led by China (who has likewise been left out of the TPP) and will be largely funded by her.

For some reason, perhaps relating to our tense relationship with Beijing, the Philippines is left out of this initiative as well. Maybe the next administration, if it has the policy inclination and diplomatic skills, could repair this situation and bring the country closer to the mainstream of regional economic integration.

Of the three declared presidential aspirants, according to the community of policy experts, only Jojo Binay actually put together a policy group. In the 2010 elections, only Gibo Teodoro bothered to establish a policy group as part of his campaign organization.

I suppose Mar Roxas has a de facto policy group in place. It is called the Aquino Cabinet – the one that already failed us.

Unless the candidates take policy issues more seriously, the possibility for building constituencies behind programs (rather than personalities) will not enlarge.