The illusion of development
At first glance, the "economic growth" bragged about by the Macapagal-Arroyo regime would seem to be true. The statistics are rosy � GDP was supposed to have grown by 3.8%, GNP by 4.9% and the agricultural sector was supposed to have posted a surprising 4.1% growth. There is a balance of payments surplus of close to P2 billion, the peso-dollar exchange rate does not stray far from the P50 mark and the stock market remains relatively "stable". Also supposedly stable are the prices of commodities, like the galunggong (round scad) that Macapagal-Arroyo "bought" for P60 a kilo.
But like the "cheap" price of galunggong � that was easily belied by marketgoers all over Metro Manila � the statistics are meaningless in the face of the actual poverty suffered by the people. The claimed economic growth is a far cry from what Macapagal-Arroyo has bragged about and is artificial and temporary, with part of it even illusory.
In reality, the Philippine economy survives solely through infusions from the outside � loans, remittances of migrant workers and foreign investments.
NON-GROWING ECONOMY
According to no less than the Bangko Sentral ng Pilipinas, remittances from OCWs remain the leading factor in the growth of the national income. In fact, almost 15% of the country�s overall income comes from such remittances. From January to April, remittances totalled up to $2.83 billion � 61% more compared to the same period last year. The growing number of Filipinos looking for overseas employment reflects the lack of opportunities to find good jobs in the country. The number of overseas workers has gone up to about eight million (more than 22% of the total work force in the country). In the first four months of the year, the number of Filipinos who have gone abroad to work even grew by 4.4%.
Foreign capital infusion seems to have grown, with the $1.5 billion in direct foreign investments being double the figure for the previous year. But the bulk of it is composed of Kirin Brewery�s payment for the shares of stock it bought from San Miguel Corporation. The rest of the amount is made up of loans extended by monopolies to their subsidiaries in the country. Excluding all this, the amount of new investments entering the country actually dropped 50%.
After hitting rock bottom for more than a year, export earnings grew slightly by 2.7% in May. Imports likewise registered a 3% growth in the first quarter of the year � after continuously posting negative figures from January 2001 to January 2002. The balance of trade deficit once more stood at $475 million in May, after momentarily becoming positive ($18 million) in April.
It is important to note that almost 40% of the additional goods imported was composed of telecommunications, electronic and office equipment. The bulk of it comprised cellphones and other telecommunications equipment (20% of overall imports) � all for the growing number of texters and cellphone users.
Production, on the other hand, remains sluggish. A leading indicator is the 20% fall in imported oil due to industry�s reduced need for the commodity.
Export industries are practically at a standstill, especially those involved in the export of electronic spare parts (which has fallen by 2.4%). Up to now, the much hoped-for recovery of the US economy (the leading market for electronic products) has not taken place. The fall in garments production was much worse (18.2%) as the US reduced its garments imports from the Philippines by 25%. The only product that continued to earn income as of late is canned tuna. But this is likewise sure to collapse now that the US Congress has passed a law approving the duty-free importation of fresh tuna from Latin America. Tuna importations from the Philippines are slapped with a 6-12% tariff.
In the first two months of this year, up to 820 factories closed down and laid off their workers. The figure is 65% higher than that of the previous year. More than 20,000 workers lost their jobs (79% more than last year). In January, up to 355 workers per day were terminated.
Contrary to Macapagal-Arroyo�s promise of creating a million jobs, the unemployment rate even grew reaching 13.4% in April) based on conservative government statistics. From 3.94 million at the beginning the year, the number of unemployed ballooned to 4.87 million by the end of the first quarter. Only the service sector registered a 1.3% growth employment � but most of the jobs were contractual or casual in nature. Aside from the unemployed, almost six million Filipino workers are underemployed.
MORIBUND AGRICULTURAL SECTOR
Upon close scrutiny, the much-vaunted P240 million-fund that the Macapagal-Arroyo regime was supposed to have poured into agriculture comprised no more than the regular budgetary allocations for agricultural agencies and funds from the Land Bank, the Agrarian Reform Fund and the Department of Agriculture. Aside from this, the regime made no other infusions into the moribund agricultural sector.
Even the creation of 800,000 jobs that the regime has bragged about is a big lie. According to the National Statistics Office, only 110,000 new jobs were created within the sector. Most of those who allegedly found jobs were agricultural workers and fisherfolk who have work only on a seasonal basis. The statistics also included those who were given 90-day jobs in various government agencies through the Emergency Employment Program and who were once again jobless afterwards. The program has had no significant effect on the status of the millions of unemployed people in the countryside.
Rice and corn production remain stagnant. Rice production posted a mere 0.7% growth in the first six months of the year while corn production even registered a slight decrease.
Contradicting a program to achieve self-sufficiency in rice production, the regime stepped up rice importations. By May, the country�s importation of 890,000 metric tons
had vastly exceeded the target of 390,000 metric tons. The government imported 780,000 metric tons of rice the previous year.
GROWING INDEBTEDNESS
The budget deficit ballooned to P120 billion in July � almost twice the six-month target. In fact, the deficit already comprises 91% of the target set for the entire year. The budget deficit is estimated to reach P158 billion to P163 billion for the whole of 2002. To control it, there are plans to reduce funds allotted to social services by up to P83 billion.
No less than the government has said that the burgeoning deficit is the result of sluggish tax collection due to low corporate incomes especially in the manufacturing sector, and reduced tariffs on imported goods � in conformity with the policies of the World Trade Organization.
From January to May, government expenditures ran up to P331 billion, higher by 15% than in the previous year. It borrowed up to P150.7 billion in the same period. External debt has undeniably balloooned. It now stands at $53.4 billion (P2.67 trillion)� $1 billion more than the previous year�s figure. It is the third largest in Asia. The Philippines likewise pays the highest interest (13.1%) in all of Asia.
NO SOLUTION TO POVERTY
Much of Macapagal-Arroyo�s braggadocio about caring for the poor and solving poverty is an outright lie.
Macapagal-Arroyo has persistently refused to increase the wages and salaries of workers and government employees. The daily minimum remains pegged at P234 (on the average) � which is woefully inadequate compared to the average P438 daily needed by a family.
The amount of land she distributed under the agrarian reform program is by far the lowest in five years. The amount of private land distributed � a mere 65,941 hectares � is less than her promised 100,000 hectares and likewise the lowest in 10 years. Such "distribution" has, in the main, been replete with anomalies, with most of it used by landlords as a means of passing on inheritance to relatives. In many other cases, landlords continue to own the lands through dummies. Macapagal-Arroyo has not lifted a finger regarding her husband�s vast landholdings in Negros.
Prices of basic services remain high. Up to now, consumers shoulder the anomalous and unjust PPA (purchased power adjustment) that comprises up to more than half of the total billing for electricity. More than the previous regimes, it is the Macapagal-Arroyo regime that has legalized the collection of such high rates through the Electric Power Industry Reform Act. Prices of prime commodities are also high, especially after successive typhoons destroyed farms and fishponds.
Macapagal-Arroyo�s promise in her SONA last year to reduce the prices of medicines by half for the benefit of the majority of the people has had no significant results. This was supposed to be accomplished through the importation of cheap medicines. But the amount of cheap drugs purchased from abroad constituted not even one percent of the country�s total consumption. Foreign monopolies continue to lord it over the drug industry in the country. The regime has been inutile as foreign monopolies effectively blocked drugstores from selling cheap medicines.
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