This is an article repost.
President Aquino’s second State of the Nation Address (Sona) was a good narrative. But it failed to respond to three concerns that cry out for public discussion and government intervention.
First, the alarming rise of food prices: although the Philippines seems to have been sheltered from the soaring global food prices, this is only relative to other countries in the region (food price inflation in Vietnam, Indonesia and China registered at 17 percent, 15 percent and 11 percent, respectively). The trajectory of food prices in the Philippines is the same as anywhere else in the world—it is going up, albeit at a slower pace. Data from the National Statistics Office show that annual food inflation increased to 4.5 percent in March from 4.3 percent in February and 3.1 percent in January.
On the average, diesel prices have been increasing by 2.84 percent and gasoline prices by 1.75 percent every week since January 2011.
These price increases should put government on its toes, because it can push millions of Filipinos below the poverty line and reverse our gains in poverty alleviation. Further, these trends, if not immediately addressed at its roots, will present even bigger problems for the Philippines in the future. Oxfam warns that the prices of staple food could double in the next two decades, while Exxon Mobil forecasts that global energy prices will also double. The government should address the factors that drive these trends, especially since it will be more difficult to confront them once our population reaches 131.5 million in the year 2030.
Second, the alarming decline in our competitiveness and productivity: according to the World Economic Forum’s (WEF) Global Competitiveness Report, the competitiveness ranking of developing Asia has outpaced ours over the last five years. We were ranked 71st out of 134 countries in 2008-09, 87th out of 133 in 2009-10, and 85th out of 139 in 2010-11. Now, the only countries we can boast of beating are Laos and Cambodia, whose economies are also fast growing. Notably, our low scores in infrastructure (ranked 104th out of 139 countries), innovation (ranked 111th), as well as institutions (125th) pull down our strengths in other areas of competitiveness.
Third, the alarmingly inadequate infrastructure investment: the poor state of infrastructure in the country contributes to our lagging competitiveness and the rising prices of commodities. We belong to the bottom quartile of the WEF’s index with regard to the quality of air transport infrastructure (112th), roads (114th), port infrastructure (131st) and ground-transport network (131st). High transportation costs, caused by the poor condition of our roads and bridges pad the prices of goods. The Philippines also needs to considerably enhance safety and security (109th), as well as upgrade tourism (98th) and ICT (98th) infrastructure.
These are issues that have to be addressed to achieve a sustainable economy. I look forward to seeing the President’s more concrete plans, as reflected in his proposed national budget.
E-mail: [email protected]. Web site: www.edangara.com.
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By: Sen. Edgardo J. Angara
Source: Business Mirror, Opinion, July 26, 2011
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