It’s still the economy, sweetheart

Our life as a nation in 2013 will largely depend on how our economy shall perform this year and to what extent would the fruits of economic development trickle down to the poorest of the poor and the middle class. It has been reported that the Philippine economy achieved an unprecedented level last year, despite all the natural disasters and other setbacks in our socio-economic and political struggles. The administration of President Aquino shall ultimately be judged by history and by international observers mainly on the basis of economic performance. It’s still the economy and no other criteria.

While the US is about to plunge into a financial cliff, and while European nations are reeling from financial disasters, the Philippines is now dubbed as the emerging “financial diamond’’ in Asia. This is a far cry from what we were used to be derided as” sick old man in Asia”. The administration’s bold moves in improving the quality of governance and public administration is gradually yielding tangible fruits. In the first quarter of 2012, our economy grew by 6.4%, second only to China and exceeding the performance of Indonesia, India, Vietnam, South Korea and even Japan, Singapore, Hong Kong and Thailand.

In the second quarter last year, our 5.9% performance was third in Asia, surpassed only by China’s 7.4% and Indonesia’s 6.3%. Our country performed higher than Malaysia, Vietnam, Thailand, Singapore, Japan and Hong Kong. Our third quarter results exceeded our own expectations, a whopping 7.1%. This was much higher than the projections of market players, global economists, funding institutions and even our own government itself. We had a 16% increase in tourists arrival, all sectors performed well. Consumer spending was brisk and expanding. Export grew by 19.7% in May 2012, and above all, government spending grew by 45.7%. All signs are positive.

The Philippines is predicted to be one of the world’s top ten fastest growing economies in the next 40 years, according to Knight Frank ad the Citi Private Wealth 2012 Global Report. The top six are Nigeria, 8.5%; India, 8%; Iraq, 7.7%, Vietnam, 7.5%; Bangladesh, 7.5% and the Philippines, 7.3%.  The Citi Group is bullish on the Philippine economy and plans massive expansion, alongside the projected mergers of BPI and PNB/Allied Bank and the bold advances of Banco de Oro. Global fund investors call the Philippines as the new darling of the Asian economy. It will be the investment paradise in the Asia-Pacific rim.

In its December 2012 issue, the BIZNEWS ASIA, predicted that by 2050, the Philippines will be a rich country, with GDP at 6.030 Trillion US Dollars, a per capita income of US $ 44,790, an average of 8.3% economic growth from 2015 to 2050, even with a total population of 134 million. As of today, our country is number 12 among the biggest market in the whole world. With US $ 315 M  GDP, we are already the 34th richest globally. We are richer than Malasia, Finland, Chile, Hong Kong, and surprisingly, even richer than Singapore and Portugal.

The United Nation’s new way of measuring wealth is called Inclusive Wealth Index, which includes Human Capital, Natural Resources and Manufactured Wealth. In human capital alone, we have 95 million, 12 million of whom are deployed in 200 countries globally. They remit more than US  $ 24 M annually or more than US $2 M every month.  This amount is five times more than the total foreign investments coming into our country. The only question we face is that our common people do not have the needed financial literacy to manage our finances. It is all spending and no saving and investment.

The most difficult problem also is how to make sure that this amazing financial performance shall trickle down to the middle class and the poorest of the poor. This is the challenge that our leaders must grapple with. This financial and economic boom should not only be for the benefit of the tycoon, the taipans, and the elite. This should be felt by those who are still jobless, homeless and hopeless. May the New Year usher into our nation a true prosperity for all who work hard and work honestly. Let’s keep our fingers crossed and keep working for our family and for our country. Mabuhay.