Our economy is on the brink and at this critical stage, we need competent handling by an experienced economic team led by DOF Secretary Ben Diokno, now putting their collective talents to thresh out the difficulties we are facing. However, some of us who do not see the whole picture yet would need some enlightenment from them.
They said, for instance, that we are on the upward trend and a progressive trajectory to reduce our debt to 60 percent ratio of GDP, target poverty reduction to 9 percent, GDP growth of around 7 percent per annum onwards, to be achievable by the end of PBBM’s term. We might be lulled into complacency if we start thinking that all will be well and normal from hereon, admittedly a good reassuring feeling – for a change. But there have been disturbing goings on in the rest of the world, like possible global recession that countries less economically equipped, like ours, might be suffering the most, especially on food and fuel supply.
Lately, rice, sugar, onions, etc. which we used to grow locally in sufficient quantity for our consumption have been added to the list of critical food items to be imported, along with the usual oil. With annual negative balance of payments, do we have enough dollars to get by?
Our economic team should speak truthfully if our situation now requires everyone to be realistic and hunker down for some belt-tightening – and that should start with the government. The P5.2-trillion 2023 National Expenditure Program (NEP) is bigger than last year’s, which registered an operating deficit of P1.6 trillion; this year’s budget could end up bigger than the official P5.2 trillion requested, according to Rep. Ralph Recto, because of un-programmed P588 billion awaiting fund sourcing.
In a tight budget financial situation, the temptation is to bump off some programmed items in the NEP, in favor of un-programmed but urgent pet items of the administration for food production, and this change in priorities would get unnoticed past Congress. If such un-programmed items bypass legislation, it would prove increasingly difficult to get a handle of the country’s ballooning debt. We did not expect our debt to go up to P13 trillion from just P5 trillion in 2016, more than double in six years, which means, honestly, that we are not really progressing in our financial security at all.
Congress, as an independent body, having the residual constitutional power over the purse, should already set net borrowing limits with congressional oversight. Sustainable government revenues should be made the reference for any new loans to force the executive to start cost-cutting. Moderate operating deficits are justifiable in any organization, if well managed versus revenue projections; on the contrary, ours has been a debt trap escalating, where we end up owing from more institutions, local and foreign, borrowing from A to partially pay B, then borrow from C to pay B, etc., and each time stretching the repayment periods, and not making any dent in reducing debts.
Hoping we can get some enlightenment from our economic managers. – M.K. Tan, Quezon City