From “Sick Man of Asia,” the Philippines has rebounded to become a tiger economy, much sought after by international investors, an achievement attributed to prudent fiscal management and good governance by the Aquino administration.
This is the gist of the state of the nation’s wealth as reported by President Benigno Simeon Aquino in his State of the Nation Address delivered yesterday, July 28, at the House of Representatives.
He cited data from the National Economic Development Authority (NEDA) that revealed the reduction of the poverty rate from 27.9 per cent in 2012 to 24.9 per cent in 2013, equivalent to “2.5 million Filipinos who have crossed the poverty line.”
At the beginning of his speech, he reported that of 223,615 scholars of the Technical Education and Skills Development Authority (TESDA), are now employed. Overall, efforts in job generation resulted in additional 1.65 million Filipinos employed from April 2013 to April 2014, he said.
Prudent fiscal management lowered the national debt to GDP ratio, he said. “Money that once went to paying interest, we were able to channel into social services.”
The President also pointed to the investment grade rating that the country was able to obtain from major credit rating agencies since 2013. The credit rating upgrade meant “that the Philippines will be able to borrow funds for projects and programs at lower interest rates, more businesses will be attracted to invest in the country, and Filipinos would be able to feel the benefits of economic resurgence more quickly.”
Another accomplishment underscored is in infrastructure development, essential to sustaining the momentum of the economy. The budget for infrastructure, he said, more than doubled from 200.3 billion pesos in 2011 to 404.3 billion pesos in 2014.
The difference between then and now is massive, he said, quoting Finance Secretary Cesar Purisima as saying: “In the past, the Philippines could not entice investors. Then, the government had to roll out incentives like commercial development rights, subsidies, and other guarantees for profit just to attract bidders. Now, the situation has reversed. Companies are now in close competition, trying to outdo each other; they are ready and willing to pay for the privilege to build the infrastructure we need.”
With the lifting by the ICAO of safety concerns it had previously issued for the Philippines, and the European Union removing the ban on Philippine Airlines flights, the tourism sector has also begun to surge, he reported.
“Today, we continue to receive news that, because of all the tourists and businessmen who wish to visit the Philippines, there is actually a shortage of flights to our country. So, all of the upgrades we have received in aviation are indeed good news: The number of flights will rise, thus providing a solution to the problem.”
The government also worked to uplift the agriculture sector by providing farmers with modern equipment to ensure the efficiency of planting and harvest. From 2011 to May 2014, 628 units of production machinery, 11,362 units of post-production machinery, and 105 rice mills were turned over to a number of farmers’ associations.
President Aquino also cited headway in improving irrigation systems, constructing farm-to-market roads, and implementing training programs to maximize farm profits.
On the looming power crisis, he said that the Department Energy had been directed to coordinate with the entire power sector in coming up a with a solution.
Other economic gains ticked off in the SONA: expanded conditional cash transfer worth 12.3 billion pesos ; good labor-management relations contributing to the improved investment climate; and awarding of public-private partnership (PPP) projects worth 62.6 billion pesos since 2011.
All these, he repeatedly stressed were the results of reform. “This is what we have fought for, and this is what we will continue fighting for: not the prevalence of the old ways, but a new system that will benefit all.”