Last week, April 5, I joined the Philippine Economic BrieStayNG (PEB), at PICC, addresses a kind of end to the Duterte administration led by Finance Secretary Carlos G. Dominguez. The inaugural address was given by Executive Secretary Salvador C. Mr. Dominguez delivered the report, followed by the Governor’s “Monetary, External and Financial Sector Update”. Banco Central Ng Pilippinus (BSP) Benjamin E. Diocono.
This was followed by a press conference with seven members of the panel: Mr. Dominguez, Mr. Diokno, Secretary of Commerce and Industry Ramon M. Lopez, Agriculture Secretary William D. Dar, Tourism Secretary Bernadette T. Romulo-Puyat, NEDA (National) Economic and Development Authority) Under-Secretary Rose Adilon, and Transport Under-Secretary Giovanni Z. Lopez.
Mr Dominguez emphasized in his report that “Duterte’s presidency has shifted to more inclusive growth and prosperity … our 2020 GDP would have sunk to 13.3% instead of 9.6% … Tax reform for acceleration and inclusion is a crown of this administration.” Acquisition. “
I call this section economic “debriefing” because comparative regional macroeconomic data does not seem to be consistent with these Philippine claims. And here are some numbers covering the 12 major economies of East and South Asia. The data sources are the IMF World Economic Outlook (WEO) database from October 2021 and the ADB Asian Development Outlook (ADO) from April 2022.
One, in the average GDP growth from 2011-2016 to 2017-2021, the Philippines with India declined the most by 3.1 percentage points. The latest average growth in the Philippines is 3.1%. StayIt was ve years longer than Singapore, Malaysia, South Korea, Thailand, Hong Kong and Japan, true. But the Philippines came from an average growth of 6.2% under the previous administration, so the drop in percentage points was absolutely huge.
Second, the Philippines is the only economy that has experienced rising inflation at the same time, rising 0.7 percentage points, while the value of 11 other economies is zero or declining. From 2011-2017, our average inflation rate was 3.4%, the second highestFeeter India, when our five ASEAN neighbors were only 0.6% to 2.7%.
Three, the Philippines experienced the highest inflation rate of 5.2% in this economy in 2018 – the first year of implementation of the TRAIN Act. The next highest inflation was 3.5% in Vietnam and the lowest was 0.4% in Singapore that year. Oil Tax Rise Part 1 – Diesel Zero to P2.50 / liter, Petrol P4.35 / liter to P6.50 / liter, etc – Implemented that year marks the beginning of a series of commodity price increases from food to wages. P6 / liter, petrol P10 / liter, etc.
Fourth, due to the ongoing war in Ukraine and US-led economic sanctions against Russia, inflation began to rise to 4% in March of this year, which probably pushed the entire world economy into a spiral of inflation.See Table 1), Therefore, the voice of some sectors to suspend or withdraw the oil tax increase of the TRAIN Act to help reduce prices in the Philippines.
Five, the second highest increase in the Philippine budget from 2019 to 2021 was 5.2%StayCity / GDP ratio after Thailand. The Department of the Treasury, Congress and many sectors of the country were influenced by Keynesian economic thinking – when family and personal spending and investment declined, government spending should expand rapidly to “stimulate” aggregate demand – questionable if not unrealistic in today’s world.
Six, demand increases with the expected “stimulated” high DStayThe cit spending did not fall as shown by the Philippines -9.6% GDP contraction in 2020, the worst since World War II. In contrast, Vietnam and Taiwan did not signStaycantly extend their dStaycit costs and they were able to achieve 2.9% and 3.4% GDP growth, respectively. This is a blow to the Kenyan economy over the past two years.
Seven, in terms of outstanding foreign debt, the Philippines had the second-largest 27% growth from 2019 to 2021, after South Korea’s 34% (See Table 2)
On the positive side, the Duterte administration should be recognized and credited for some good steps and financial reforms. Among these are the new Ease of Doing Business Act, introduced primarily by the Department of Trade and Industry under Secretary Ramon Lopez. We need more business and job creators, not more bureaucrats.
The BSP has consistently managed our external accounts under Mr. Diokno. Our Gross International Reserve (GIR) has increased from $ 79.2 billion in 2018 to $ 110.1 billion in 2020 and $ 108.8 billion in 2021. This was equivalent to about 10 months of import cover and so we were protected from any power supply shocks. Due to this huge GIR level. Also, BSP had a digital payment transformation roadmap that has strengthened the digital payment ecosystem.
I saw George Barcelona, the new president of the Philippine Chamber of Commerce and Industry (PCCCI), at the event. Since they are the largest business organization in the country, I asked him his assessment about PEB. His response:
Build, build, build initiatives have been successful in building roads, railways, airports and seaports all over the country. Regarding tax reform, TRAIN, CREATE (Corporate Recovery and Tax Incentives for Enterprises Act), Public Service Act, Foreign Investment Law, and Retail Trade Liberation Act, etc. will transform our country’s ability to attract foreign investment and financial aid. Health and education. The private sector was initially frustrated with the operation of COVID-19, where strict quarantine was imposed without the involvement of stakeholders in the decision-making process. But the credit goes to the business owners and the cooperation and discipline of the general public. Minor errors are gaps that can be solved The new administration can rely on the groundwork of the current administration. “
If I had to grade the overall economic performance of the Duterte administration in the last six years from 1.0 to 5.0 as 1 great and 5 failures, looking only internally StayI’ll give it 2.5. But considering the relative performance of our neighbors in this region, I would give it 3-3.5: 2.0 in 2017-2019 and 4.5 in 2020-2021 because of its strict prolonged lockdown and movement restrictions and the underlying compulsory vaccination policy.
Hopefully the next administration will not follow the whims of this government. And in order to secure a change in economic policy over the next six years, Duterte-ally Bambang Marcos-Sara Duterte should not win the tandem.
Bienvenido S. Oplas, Junior is the President of Minimal Government Thinkers
Minimum government@ gmail.com