Posted tagged ‘business’

COÑO POWER IN AQUINO GOVERNMENT

April 19, 2011

COÑO POWER IN AQUINO GOVERNMENT

Erle Frayne D. Argonza

Coño kid Noynoy Aquino is now president of the Philippines for almost a year. During the campaign period yet, I was already apprehensive of the handiwork of coño operators who were born with a ‘golden spoon’. They are those kinds who went to school with the purpose of displaying wealth and flashy cars, and were subjects of my scorn as a college student.

Just recently, P-Noy bought a sports car worth millions of pesos. Though supposedly a used car, just sporting that kind of vehicle would already raise eyebrows in many quarters. For accompanying that car is the lifestyle that goes with it. It is the lifestyle of lotharios, drug addicts, socialites, and every kind of derelict person you can think of out there, who surely live it dirty.

Now that the coños are in power, what have you to say? Will the same coño socialities throw cakes to the poor in order to solve poverty, as Marie Antoinette believed was the correct solution to pauperism?

[Philippines, 14 April 2011]
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VILLAR: EMBODIMENT OF ‘PHILIPPINE DREAM’

Prof. Erle Frayne D. Argonza
08 January 2010

The social forecaster J. Naisbitt, among the sharpest observers of cultural innovations worldwide, declared in his book Megatrends Asia that the ‘Asian dream’ is the global dream of the moment.
Realizing this gigantic power shift, Naisbitt challenged the youth of the West to “go East!”

If we were to localize the global trend of ‘Asian Dream’, we can find this in the capsule term ‘Philippine Dream’. This is the dream of any struggling child to live a future of abundance, a dream that was once championed in America (‘American dream’) but which has been lost along the way, a dream that has found root finally in our own motherland.

My contention is that, if the Philippine state would refurbish its nauseating image as a ‘weak state’, it would find a fresh start in electing a president who is an embodiment of the ‘Philippine dream’. Luck of all luck, the Nacionalista Party’s own top leader, Manny Villar, fits squarely into this ‘Philippine Dream’ mold.

The Manny Villar narrative is practically saying to our compatriots that nobody has to leave the country for overseas job in order to live abundance in everyday life. Stake it out in the country, live to learn well, be daring to be innovative and pioneering, and one will rise like a phoenix from the ashes of poverty.

Do not wait for opportunities to drop from the sky like ripe guavas descending on the mouth of a proverbial Juan Tamad. Build the opportunities, and be daring to re-engineer yourself in the process to keep on bringing you up to the next level of success.

Such is the sterling truth exemplified by the Villar narrative, which is indeed splendidly impressive and worth a plethora of accolades. Only Villar fits this mold among the couples of presidential candidates, most of whom are the typical coño kids who treat the poor folks as utilitarian objects for vote-gathering purposes. Not only did Villar soil his hands in creating opportunities for housing and urban development, he was also among those noblesse legislators who built enabling measures to widen the latitudes of social equity and economic prosperity. And yet no coño kid is he amid his abundant life!

I remember the coño kids on campus as highly scorned spoiled brats who are in the university largely to display wealth and who condescendingly regard their schoolmates as lizards and rats. A few of them did I make friends with, those who can be remolded to a life of social relevance, even as I was among those self-supporting students (I was a full scholar) and grew as a militant activist. Well immersed among fellow intellectuals, I only had but expletives reserved for the coños.

Today I am among those who ask: what right has a coño to be president of the republic? A person who grew up in a mansion and couldn’t soil his hands in work deserves to be a leader of colonial era government, and such an era is long gone!

I would ask the same for a vice-president: what right has a coño to be vice-president of the country? Isn’t Loren Legarda, who now teams up with Manny Villar, the most fit for the job since she embodies the ‘Philippine dream’ and all the sterling qualities of a talented and competent Pinoy who has risen from the hovels and lead a prosperous life?

An emerging market such as the Philippines has most to gain from electing highly competent top officials who embody the ‘Philippine dream’ and/or ‘Asian dream’. Conversely, it would be disastrous to elect Inquisitionist coño kids who in fact are mere smokescreens for crocodiles.

I am a firm believer in the ‘Philippine dream’ or ‘Asian dream’, and I go for a Villar-Legarda team for 2010.
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Come Visit E. Argonza’s blogs & website anytime!
Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

Website:
PROF. ERLE FRAYNE ARGONZA: http://erleargonza.com

POVERTY: PH LINGERING ACHILLES HEEL

April 14, 2011

POVERTY: PH LINGERING ACHILLES HEEL

Erle Frayne D. Argonza

Let me follow through on the hunger report by reflecting on poverty once more. Ph is an economic boom episode and its chief exec Noynoy Aquino has been in power for almost a year since installation. Yet hunger grows amidst relative abundance!

Government statistics has to be massaged anew so as to make it appear that poverty has been going down. The ‘doctorates of statistical massage’ should better do their jobs well, as the latest survey of the Social Weather Stations clearly show a hunger rate of 20%. It’s so self-evident that poverty breeds hunger, so the growing hunger means poverty is growing too, isn’t it? Commonsensical a stuff!

Below is an article on poverty that I wrote while the election period was still going on last year. Since last year, poverty hasn’t shrunk!

[Philippines, 08 April 2011]
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POVERTY: PHILIPPINES‘ ACHILLES HEEL

Erle Frayne D. Argonza

Poverty is the Achilles’ heel of the Philippine state, and will be so for at least two (2) more decades. Amid the appreciable growth the economy has sustained so far, with the national economy doubling in just eight (8) years during the incumbency of president Gloria Arroyo, poverty remains very high.

If we go by the yardsticks of the United Nations Development Program (UNDP) and the World Bank, the Philippines has been performing fairly well on wealth production as a whole, so much that the country graduated to a middle income status by the turn of the century. No more a poor economy by world standards, yet the country’s poverty increased from 28% in 2001 (when Arroyo took over the presidency) to 33% today (per latest government statistics).

Paradoxical, come to think of it, that while the economy has been growing and had moved to middle income status, more people have become poorer. Tough, very tough, is the task of mining for the ‘gini in the bottle’ that would reduce poverty considerably to a negligible 5% or less, a level that is easily manageable and where state and communities can simply decide to fully subsidize the remaining poor.

Whether the Philippines can meet the UN’s Millenium Development Goal of cutting poverty by half in 2015 seems much clearer now to social forecasters: the dream is elusive and unattainable. Not even if the economy will double again from mid-2009 to 2015 which is a most likely development.

The Philippines’ poorest happens to be the rural populations, notably the fisherfolk sector where malnutrition runs the highest rate (2/3 of children/families). Rural population is now down to 34% or 1/3 of the population, while the urban peoples comprise 66% or 2/3. Urban to rural poverty ratio is 1:2.5, meaning that for every 1 poor person in the cities & towns, there’s an equivalent of 2.5 persons in the countrysides.

The message is clear to the next government (formed by the new president after the May polls this year) that the attack zone on poverty should be the rural population. Both antipoverty and anti-hunger programs should be initiated at very high levels in the countryside to be able to bring down total poverty by a large degree.

Failure to solve rural poverty in the long run redounds to perpetuating insurgency. Even if the present insurgent groups would concur peace pacts with the state, new insurgent groups will emerge again in the foreseeable future should the rural folks remain paupers.

Urbanization is now moving up, and with its growing eminence has come the rise of new cities. Citification has seen the incomes of communities treble by leaps and bounds, thus permitting the same communities to spend on infrastructures and social development.

Left to themselves, without massive migrations from rural folks, the cities can accumulate enormous income surpluses to solve unemployment, poverty, and malnutrition (both hunger and obesity). Philanthropic groups consequently rise from civil society and market players, and boost surplus production for solving poverty.

However, such is not the case even as the migration of the poor from the countryside to the cities continues in steady waves. So this brings us all back to the challenge of solving poverty right at the backyards where the poorest are most concentrated. This means that the food producers shouldn’t be left out in the development game, even as rural development should be brought to its next level.

Goal-wise, the realistic target is to reduce poverty from 33% in 2009 to 25% by 2015, or an average of 1.33% reduction per annum. Means-wise, an appreciable mix of good governance, right socio-economic policies, and strengthening of institutions would do a long way to bring down poverty altogether in the short run.

Urban population will grow to 70% around 2015, while rural population will go down further to 30%. With lower rural populations to manage by then, there is no more reason for government not to be able to do something to solve poverty. And we say government, because the increase in poverty largely came from governance-related factors such as poor absorptive capacity (to handle large budgets), inefficiency, graft, poor inter-governmental coordination, and low political will to pursue audacious solutions to daunting problems.

In 1989, this analyst wrote an article “Prospects of Poverty Alleviation in the 1990s,” a piece that I delivered as a symposium lecture at the University of the East (Prof. Randy David was also a speaker). At that time, poverty was a high of 49%, while urban to rural poverty was 1:2.1.

Since 1989, we have seen poverty reduced from 49% to its present level of 33% (a 5% increase since 2001 though), although rural poverty moved up paradoxically during the same period. Poverty reduction is not really impossible, as evidenced by the huge reduction across a 20-year period. Bringing it down further to 25% by 2015 is a doable target.

So let us see how the nation will fair under the next government of the republic (after May polls), when we see a new set of political leaders and cabinet members installed to power. As I’ve mentioned in earlier articles, my standpoint is that a nationalist coalition, such as what the present candidate Sen. Manny Villar, is most equipped with policy paradigm and tools to deal with the Achilles heel of pauperism, aside from the competence and visionary acumen of the noblesse senator.

By nationalist, I mean that of moving towards a regulated market and fair trade, with high propensity for ‘physical economy’ policies. We can no more return to the days of liberalization policies that saw the economy crash down in ’83-’85, stagnate for a time and grow again before hitting the next recession in ’97, and finally move up to middle income status only after a turtle pace struggle taking three (3) decades.

Liberalism and its propensity to be pro-Big Business and Big Landlord is a big no in our fight against poverty, whether in the Philippines and other nations of the globe. In my country, nationalism is the antidote paradigm and social technology watershed to reverse decades of liberal policies and solution to poverty. I’ve been echoing this theme since my teenage years yet, and remains steadily anchored on it.

[Philippines, 20 March 2010]
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Come Visit E. Argonza’s blogs & website anytime!
Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

Website:
PROF. ERLE FRAYNE ARGONZA: http://erleargonza.com

POVERTY: PH LINGERING ACHILLES HEEL

April 11, 2011

POVERTY: PH LINGERING ACHILLES HEEL

Erle Frayne D. Argonza

Let me follow through on the hunger report by reflecting on poverty once more. Ph is an economic boom episode and its chief exec Noynoy Aquino has been in power for almost a year since installation. Yet hunger grows amidst relative abundance!

Government statistics has to be massaged anew so as to make it appear that poverty has been going down. The ‘doctorates of statistical massage’ should better do their jobs well, as the latest survey of the Social Weather Stations clearly show a hunger rate of 20%. It’s so self-evident that poverty breeds hunger, so the growing hunger means poverty is growing too, isn’t it? Commonsensical a stuff!

Below is an article on poverty that I wrote while the election period was still going on last year. Since last year, poverty hasn’t shrunk!

[Philippines, 08 April 2011]
#########################################

POVERTY: PHILIPPINES‘ ACHILLES HEEL

Erle Frayne D. Argonza

Poverty is the Achilles’ heel of the Philippine state, and will be so for at least two (2) more decades. Amid the appreciable growth the economy has sustained so far, with the national economy doubling in just eight (8) years during the incumbency of president Gloria Arroyo, poverty remains very high.

If we go by the yardsticks of the United Nations Development Program (UNDP) and the World Bank, the Philippines has been performing fairly well on wealth production as a whole, so much that the country graduated to a middle income status by the turn of the century. No more a poor economy by world standards, yet the country’s poverty increased from 28% in 2001 (when Arroyo took over the presidency) to 33% today (per latest government statistics).

Paradoxical, come to think of it, that while the economy has been growing and had moved to middle income status, more people have become poorer. Tough, very tough, is the task of mining for the ‘gini in the bottle’ that would reduce poverty considerably to a negligible 5% or less, a level that is easily manageable and where state and communities can simply decide to fully subsidize the remaining poor.

Whether the Philippines can meet the UN’s Millenium Development Goal of cutting poverty by half in 2015 seems much clearer now to social forecasters: the dream is elusive and unattainable. Not even if the economy will double again from mid-2009 to 2015 which is a most likely development.

The Philippines’ poorest happens to be the rural populations, notably the fisherfolk sector where malnutrition runs the highest rate (2/3 of children/families). Rural population is now down to 34% or 1/3 of the population, while the urban peoples comprise 66% or 2/3. Urban to rural poverty ratio is 1:2.5, meaning that for every 1 poor person in the cities & towns, there’s an equivalent of 2.5 persons in the countrysides.

The message is clear to the next government (formed by the new president after the May polls this year) that the attack zone on poverty should be the rural population. Both antipoverty and anti-hunger programs should be initiated at very high levels in the countryside to be able to bring down total poverty by a large degree.

Failure to solve rural poverty in the long run redounds to perpetuating insurgency. Even if the present insurgent groups would concur peace pacts with the state, new insurgent groups will emerge again in the foreseeable future should the rural folks remain paupers.

Urbanization is now moving up, and with its growing eminence has come the rise of new cities. Citification has seen the incomes of communities treble by leaps and bounds, thus permitting the same communities to spend on infrastructures and social development.

Left to themselves, without massive migrations from rural folks, the cities can accumulate enormous income surpluses to solve unemployment, poverty, and malnutrition (both hunger and obesity). Philanthropic groups consequently rise from civil society and market players, and boost surplus production for solving poverty.

However, such is not the case even as the migration of the poor from the countryside to the cities continues in steady waves. So this brings us all back to the challenge of solving poverty right at the backyards where the poorest are most concentrated. This means that the food producers shouldn’t be left out in the development game, even as rural development should be brought to its next level.

Goal-wise, the realistic target is to reduce poverty from 33% in 2009 to 25% by 2015, or an average of 1.33% reduction per annum. Means-wise, an appreciable mix of good governance, right socio-economic policies, and strengthening of institutions would do a long way to bring down poverty altogether in the short run.

Urban population will grow to 70% around 2015, while rural population will go down further to 30%. With lower rural populations to manage by then, there is no more reason for government not to be able to do something to solve poverty. And we say government, because the increase in poverty largely came from governance-related factors such as poor absorptive capacity (to handle large budgets), inefficiency, graft, poor inter-governmental coordination, and low political will to pursue audacious solutions to daunting problems.

In 1989, this analyst wrote an article “Prospects of Poverty Alleviation in the 1990s,” a piece that I delivered as a symposium lecture at the University of the East (Prof. Randy David was also a speaker). At that time, poverty was a high of 49%, while urban to rural poverty was 1:2.1.

Since 1989, we have seen poverty reduced from 49% to its present level of 33% (a 5% increase since 2001 though), although rural poverty moved up paradoxically during the same period. Poverty reduction is not really impossible, as evidenced by the huge reduction across a 20-year period. Bringing it down further to 25% by 2015 is a doable target.

So let us see how the nation will fair under the next government of the republic (after May polls), when we see a new set of political leaders and cabinet members installed to power. As I’ve mentioned in earlier articles, my standpoint is that a nationalist coalition, such as what the present candidate Sen. Manny Villar, is most equipped with policy paradigm and tools to deal with the Achilles heel of pauperism, aside from the competence and visionary acumen of the noblesse senator.

By nationalist, I mean that of moving towards a regulated market and fair trade, with high propensity for ‘physical economy’ policies. We can no more return to the days of liberalization policies that saw the economy crash down in ’83-’85, stagnate for a time and grow again before hitting the next recession in ’97, and finally move up to middle income status only after a turtle pace struggle taking three (3) decades.

Liberalism and its propensity to be pro-Big Business and Big Landlord is a big no in our fight against poverty, whether in the Philippines and other nations of the globe. In my country, nationalism is the antidote paradigm and social technology watershed to reverse decades of liberal policies and solution to poverty. I’ve been echoing this theme since my teenage years yet, and remains steadily anchored on it.

[Philippines, 20 March 2010]
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Come Visit E. Argonza’s blogs & website anytime!
Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

Website:
PROF. ERLE FRAYNE ARGONZA: http://erleargonza.com

PHILIPPINE BANKS HEALTHY FOR THE BIG CHALLENGES AHEAD

March 25, 2011

PHILIPPINE BANKS HEALTHY FOR THE BIG CHALLENGES AHEAD

Erle Frayne D. Argonza

Good day to you fellow global citizens!

The world reels anarchic over the geological ramblings in Japan-New Zealand-China and the tumult of the Arab peoples. These events cast veils on the clarity of the economic boom now going on in Asia, and so let me be among those who will project the boom side every now and then. Among such good news is the readiness of Asian banks for the bigger economic battles ahead, a trend that includes the Philippines’ banks.

Do recall that the Asian financial meltdown came in ’97, triggering recessions, mass lay-offs, manufacturing slumps, and heightened poverty. The policy environment then was one of free trade in the movements of finance and money across borders, which enticed portfolio capital to swamp Asia. Regulators were therefore caught off guard by the currency attacks fomented by the Anglo-European oligarchs fronted by the Quantum Group of George Soros.

Asia’s banks, monetary authorities, and financial stakeholders all learned precious lessons from that economic catastrophe. Short of establishing capital and monetary controls (such as what Mahathir did for Malaysia), Asian banks did institute quasi-regulatory reforms such as to raise banks’ reserve requirements, mop up excess liquidities when situation demands so, and finally fix caps on the asset requirements for banks.

The reforms instituted across the last fourteen (14) years since the meltdown paid off very handsomely for the commercial and universal banks in particular, as well as for strengthening central banks. It is important to ensure stabilization mechanisms in the said banks first of all, a pattern that will snowball in the thrift banks and rural banks.

As far as the Philippine republic is concerned, the latest situational reports do indicate very clearly the compass of a healthy banking overall. Total aggregate assets of commercial & universal banks exceeded P6 Trillions, deposits breached the P2.5 Trillions, and trust funds skyrocketed to past the P4 Trillion mark. Needless to say, our banks here are prepared for the big challenges, inclusive of financing big ticket Private-Public Partnership or PPP projects.

The same banks are very much prepared too for the latest regulatory requirements imposed by the BIS or Bank for International Settlements. The BIS adjustments are actually coming late in the day, as the said bank has been too Euro-centric for a long time. Were it not for the fiasco of the USA and European banks from 2007 through 2010, the BIS couldn’t have acted appropriately.

Western banks ought to admit it that they are learning the new adjustments from their Asian counterparts. And the lessons being shared by the Asian banks are the ones being considered strongly today by the BIS itself, which as one can see has been commending Asia’s central bank bosses for jobs well done in their respective backyards.

There are more reforms that must be instituted however, which means that the earlier reforms should only be the start of a series of long-term changes in the banking and monetary systems. I subscribe to a global effort to ban banks from participating in portfolio investments so as not to repeat the catastrophe that hit certain big US banks that disappeared overnight during the height of the recent Great Recession there.

The more efficacious management of bankruptcies should also be put into order. We are right now witnessing a bank run in the Bangko Filipino, which seems to repeat old patterns. More stringent regulations ought to be put into place, as it is getting tiresome now to see bank runs every now and then.

Essential corporate governance reforms are among those that need to be accelerated in the banking and monetary systems. Bank mismanagements and hostile take-over of smaller banks by bigger ones are spooky phenomena within the banking community, which pose as challenges to regulators.

Let the banks and regulators keep tab of the gaps in the system and address them accordingly. Meantime, with a healthy banking situation now in place, banks can clearly become stakeholders in creating the boom situation in the Philippines, ASEAN, and the whole of Asia.

[Philippines, 17 March 2011]

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Come Visit E. Argonza’s blogs anytime!

Social Blogs:
IKONOKLAST: http://erleargonza.blogspot.com
UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:
COSMICBUHAY: http://cosmicbuhay.blogspot.com
BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:
ARTBLOG: http://erleargonza.wordpress.com
ARGONZAPOEM: http://argonzapoem.blogspot.com

Mixed Blends Blogs:
@MULTIPLY: http://efdargon.multiply.com
@FRIENDSTER: http://erleargonza.blog.friendster.com
@SOULCAST: http://www.soulcast.com/efdargon

IS THE PHILIPPINES ALREADY INDUSTRIALIZED?

January 14, 2011

Erle Frayne D. Argonza

 

Let me continue with the reflections on my beloved Philippines’ economy. This effort is often part of my self-accepted duties to update myself and my compatriots about the state of the Philippine economy at the start of every year.

Just a week ago, I came across an article writ by one of the stock market columnists in the Philippine Daily Inquirer of PDI, that re-echoed an emerging perception in the international business community concerning the Philippine economy’s being ‘industrialized’ today. Coming from the business community itself, this evaluative perception is replete with many implications for the country. It bodes well for the country in fact.

I wish that the perception will resonate with greater power by the day so that those in academic and ideological circles will rethink their positions about the Philippine ‘mode of production’. As far as the Maoists are concerned, PH will always remain as semi-feudal/semi-colonial, backward, agrarian economy. Some academic circles will re-echo the same old worn out “PH is a service economy, with mixed economy features.”

This analyst still recalls very well the ‘mode of production’ debate that  reverberated the halls of the University of the Philippines in the 1980s. I graduated from this university in October 1980, then came back to take up graduate schooling in sociology from Nov. ‘83 to April ‘89, and so I was able to flow with the discussions and debates ensuing. The debate centered largely on whether the Philippines is semi-colonial/semi-feudal (Maoist) or capitalist mode (moderate Marxists, populists, social democrats).

By the mid-90s, the debate was already faltering and dying out. It was a dead debate when the year 2000 rang a sonorous beacon of the new millennium. But if you ask any of the competing ideological blocs today about their perceptions of Philippine reality, you will notice that they will churn out the same lines that they’ve been saying for decades.

As regards the perception that PH economy is a ‘service economy’, the criterion is largely based on what sector—agriculture & forestry? industry? services? –contribute the greatest to the gross domestic product or GDP. Since services contribute 55% to the GDP, then PH is a ‘service economy’.

That evaluative perception has a kindergarten undertone to it, as it relies on simplistic assumptions.  Just because the industrial sector, which churns out barely 30% (manufacturing + infrastructure combined) of the GDP, looks diminutive than services, doesn’t merit an economy to be judged as ‘services’ or ‘non-industrial’ economy.

To be fair to those opinion quarters who have their own paradigm that churn out specific evaluative judgements, the term ‘industrializing’ was used to label Philippine development since the 1980s. At one point, PH was included among the NIEs or ‘newly industrializing economies’, and so the reference point was industry more than services.

Let’s go back to the USA in the year 1900 when it was already adjudged as industrialized. Industries began to enable the imperialistic pursuits of the USA then, if you recall your history well. But at that time, agriculture was still employing over 90% of the workforce, and nary an evidence can be shown that industry had out-stripped agriculture at that juncture as the main contributor to the national income (today’s GDP) perentage-wise. Yet the USA was already adjudged as ‘industrial’ at that time!

If the criteria would be largely the (a) prevalence and (b) impact of capital goods or ‘reproducible goods’ industries, then the market players have clear evidences to show such increased prevalence and impact. Save for integrated steel and castings & forging industries, every vital capital goods are already being manufactured in PH today. Unless of course that the ‘services economy’ judges are blind to these developments.

The emerging perception and judgement about PH economy should be impetus enough to cause a re-tooling by the analysts and ‘best practices’ innovators. It would prove beneficial for everyone if coteries of opinion-makers, business executives and capitalists themselves would begin the ball rolling by publishing their emerging perception about the ‘emerging markets’ such as PH to be already ‘industrialized’.

As a related event, I just signaled the young Prof. John Ponsaran, head of the development studies program in the UP Manila, about the emerging perception. I once taught in the UP Manila’s department of social sciences, where development studies is niched, so I know the temper of the faculty there that goes for debating on anything under the sun. I hope the emerging perception will be tackled in that campus.   

[Philippines, 08 January 2011]

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Come Visit E. Argonza’s blogs anytime!

 

Social Blogs:

IKONOKLAST: http://erleargonza.blogspot.com

UNLADTAU: https://unladtau.wordpress.com

Wisdom/Spiritual Blogs:

COSMICBUHAY: http://cosmicbuhay.blogspot.com

BRIGHTWORLD: http://erlefraynebrightworld.wordpress.com

Poetry & Art Blogs:

ARTBLOG: http://erleargonza.wordpress.com

ARGONZAPOEM: http://argonzapoem.blogspot.com

 

Mixed Blends Blogs:

@FRIENDSTER: http://erleargonza.blog.friendster.com

@SOULCAST: http://www.soulcast.com/efdargon

Website & Mixed Blogs:

MULTIPLY: http://efdargon.multiply.com

PHILIPPINES’ FOREIGN EXCHANGE BREACHES $62 BILLIONS

January 12, 2011

Erle Frayne D. Argonza

Good day to you, fellow global citizens!

 The newspapers this morning released a gladdening news about a macro-economic fundamental in my beloved Philippines: foreign exchange or FOREX reserves breached the U.S. $62 Billion mark. The news item means that my country has all the foreign currencies to purchase a year-long worth of imports and still end up with a surplus of money.

That is inarguably good news, a veritable proof of how strong the Philippine economy is. My country surely belongs to the ‘Asian economy’ and is part of the region that is intractably the growth driver of the global economy today. PH’s forex grew by almost 50% from $44 Billion in 2009 to $62 Billion in 2010, and that is a very newsworthy development.

Practically all of the major macro-economic indicators in the country ended up with good results as of end of December 2010, thus ensuring prognosis of healthy fundamentals in the foreseeable future. GDP growth rate is good (c. 7%), balance of payments is at surpluses worth billions of U.S. dollars, exports & imports have rebounded since the lamentable contraction in 2009 (affected by the North’s recessionary winds), wages have been going up, inflation rate has been a manageable 2.8%-4.2%, debts are manageable (no fiscal crisis in the short run), domestic market had expanded by double digit, and liquidity has been sustained at manageable level.

So far so good! I have no better wish than to see the rising forex levels sustained so that PH can breach forex reserves of $100 Billion as early as 2012. At that level, we can safely say that foreign currency (dollar, pound sterling, yen, euro) will be an over-the-counter commodity, thus ending decades of forex crisis that was a factor behind PH’s low capability to secure foreign loans for its big ticket development projects.

The days of the forex crisis—whence forex levels wasn’t even enough to pay for 1 month of imports—is way behind us now in the ‘pearl of the orient seas’. Our forex reserves, added to the other macro-economic fundamentals, have rendered our country as more than stable economically and financially, thus meriting an upgrade in its assessment by investment evaluators (e.g. Moody’s).

The only thing to watch out, in a cautionary manner, is the contribution of portfolio investments to the forex level of late. As the northern economies burn, ‘smart money’ has been departing from their niches and finding new havens in Asia. And so a substantial sum of billions of dollars of that ‘smart money’ found its way into the Philippine financial and capital markets.

Our financial markets here are very highly liberalized, so the danger that volatilities can bring to our very own forex reserves is there. Extreme volatilities elsewhere in the globe can lead to investors’ gross divestment of their portfolios, thus leading to a domino effect of economic crash.

I have no problem admitting that short-term investments do make an economy healthy enough, provided that the regulatory mechanisms—available as tool to address volatilities’ adverse effects—are strengthened or reinforced at this moment. We can never have a repeat again of the Asian financial meltdown in 1997, a meltdown that began with currency attacks and then led to domino effects of crashing blows on banking, realty, manufactures, infrastructures, and the other sectors as well. No sir! We can and should never have a repeat again of that Dark Year of ’97!

Short of installing capital control measures, such as what Mahathir Mohammad did for Malaysia, PH’s central bank and monetary board should evaluate quickly the impact of possible volatilities through simulation models at hand. Maybe more tighter regulatory interventions should be installed as options in case of the contingencies arising, measures other than manipulating the liquidities through interest rates or shoring up fiscal capabilities through extended treasuries sales.

Among the options to be taken is the imposition of a Tobin Tax on all cross-border financial transactions. I have been echoing this option since the late 1990s yet, and I will again echo it this time. Just by imposing 0.35% tax on all such transactions, the country can accumulate buffer stocks of monies for the rainy economic days, at the same time that it can contribute immensely to international organizations such as the UN (as per prescription by the late economist James Tobin).

Meantime, for the Filipinos and Asians, cheers over the buoyant forex reserves in Manila! Mabuhay!

[Philippines, 08 January 2011]

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JUDICIAL OVERSIGHT IN DEVELOPMENT PROJECTS & BUSINESS

December 6, 2010

Erle Frayne D. Argonza

A relatively pleasant month it is in Filipinas this month of the year, though it showers intermittently as cold winds up north converge with warm equatorial winds. As the air becomes cooler, let us reflect on a raging issue worldwide concerning the extent of judicial power in economic & business concerns.

Filipinas is mired right now in questions about the said powers of our magistracy (Supreme Court) in regard to interventions in franchises and business operations. The executive (presidency) is particularly getting peeved at the seemingly Draconian powers the magistracy has been exhibiting, powers that could obstruct presidential initiatives in pushing through the new investments in big ticket projects.

There is now a perception peddled by the president’s spin doctors that the magistracy is turning into an obstructionist. Recognizing that the Supreme Court is no perfect institution, as the Justices’ decisions on business and project concerns could be tainted with corruption, to declare that it is obstructionist (i.e. it makes decisions for the sake of demonstrating its powers over the presidency) demands deeper reflections and deconstruction.

Presidential prerogatives could turn into bad curves every now and then, as they are used to favor certain market players over and above the Law. This is where our reflections should begin. The presidency (executive institutions) in the Philippines is particularly very corrupt and inept, and favors certain market players at the expense of fairness and constitutional regulations.

The abuses of presidential prerogatives on business franchises during the time of President Ramos, among others, have seen onerous franchises and contracts executed. The energy sector in particular became infested with greedy power producers who were favored over other players, palpable acts of felony that should have incarcerated the president himself.

But that’s not all. There were the Malaysian investors known for notoriety, who cornered whatever state companies and business concerns there were available in the 1990s for their portfolio investments to gobble up. The National Steel Corporation landed in the hands of the Hottick Group that never introduced any internal development in the company but which, in fact, closed the company up and sold it at five (5) times its purchase price much later (with state intervention in the transaction) to the Indian group Global Steel.

So many big ticket projects during Ramos’ incumbency were akin to the National Steel fiasco, while others were mired in corruption in the granting of the franchises. Ramos himself became a very wealthy man after he left office, yet he remains free amid the questionable presidential prerogatives his Office exercised then.

It is within the context of abusive presidential prerogatives that one should comprehend the exercise of judicial oversight with high-level intervention. The judiciary is a last bastion of fairness and rationality in project contracts and business franchises in a country with weak governance institutions, and so it flexed its muscles as provided for any way by the national charter as the Philippine case exemplifies.

No matter how well meaning the executive department may be, it has no monopoly of powers and wisdom to decide prudently about projects and franchises. President Aquino’s coterie of aides is pregnant with greedy and corrupt elements that include those who served as cabinet members in previous regimes. So why should the public leave everything to the presidency, when the presidential office is a classic nest of graft?

When the judiciary commits flaws that must be addressed, then they can be cited by a vigilant civil society and be addressed properly. One case in point is the issue of plagiarism hurled against a Justice by the professors of the University of the Philippines College of Law, with the concomitant demand for resignation by the plagiarist concerned.

While the magistracy continues to strengthen its own internal weaknesses, it must just the same exercise its oversight powers concerning developmental projects and business franchises. It will prove catastrophic if the incompetent presidential aides will hatch an operational modus aimed at destroying constitutional powers of judicial oversight, as such will become a new monstrosity that will lead to new rounds of corrupt acts by state and business mafias.

[Philippines, 04 December 2010]

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KICKBACKS & PEACEKEEPING, TV JOURNALIST’S ABU SAYYAF ABDUCTION

June 15, 2008

Erle Frayne  Argonza

Good afternoon from Manila!

As of this moment, Manila is in the heat of coffee shop speculations about the fate of the recently abducted Ces Drilon & crew, personnel of the oligarchic network ABS-CBN, by the Abu Sayyaf. The ‘cara y cruz’ debate is whether the Lopez group will pay for the ransom of Drilon & crew, amounting to $5 Million more or less.

Having observed peacekeeping for some time now, and having had the privilege of being close to peace negotiators on both camps (state and rebel counsels), I know very well about the perks that go with peacekeeping. A favorite popular idiom today, when one is uncertain whether to push through with a work engagement, is “i-career mo na” (make a career out of it). This goes through for peacekeeping.

Let me ping straight to the point: there’s a lot of kickbacks in peacekeeping, that is why it is a great project engagement for any state official to role-play peacekeeper. On the terrorist side, mujahideen work becomes adventure, fun and good life as sweet money would come around every time that abductions and raids would be mounted. Abduction, specifically, is a ‘win/win’ situation (Fidel Ramos favorite idiom).

Here is the value chain of abduction: A group of young terrorists are tasked to abduct any bankable personage or group. Most probably a preliminary assessment had been done about the ‘book value’ of the proposed victims. With all parameters and actions observed (on the backward and forward linkages, inputs and outputs), the group then proceeds to abduct the bankable victim and team members.

The ever ready peacekeepers, actual (those with mandates) and potential (those local and other personages who can do go-between or back-channel tasks), will then quickly respond to the situation. The terrorists are aware of the chain of peacekeepers, and knowing the “10% goes to Boss” S.O.P., they already padded the price of the ransom. A lot of contingency expenses are entailed in the negotiations, a lot of risks too, so all operating expenditures must be covered in the ransom estimate.

The bargaining then begins as soon as the peacekeepers rendezvous with the terrorists or their authorized agents. To show semblance of civility and concern, the peacekeepers would try to strike a bargain, but not rock-bottom please. Nobody wants to come home empty-handed, please understand.

Upon doing the preliminary rendezvous, the terrorist group or T-Group would then re-assess the estimate. They have already done their own counter-espionage about the ‘chain of peacekeepers’, so this dovetails in the decision whether it is sound to scale down or move up the ransom. Factoring along the number of new T-Group recruits who may need immediate ‘glad tidings’ support is also an important decision input here.

The family or firm that is set to pay ransom will make the pronouncement that “there will be no ransom” and the rationale that “we will not and never will negotiate with criminals and terrorists.” This is a mere cover-up by-line, remember, I know this for a fact. Non-payment is too remote from reality, I’m very certain about this.

What is factual is that the family or firm would have to decide quickly to pay more as soon as a bargain had been done via back-channel. Often than not, the paying group must also offer gifts (payola incentives) to the back-channel negotiators. Payment must really be quick and sweeping. Because failure to do so would make the T-Group raise the ransom, and the negotiations after that would be more difficult, hazardous, and  the chain of peacekeepers would rise, perhaps following 2-3 chain tracks.

So, what happens upon the conclusion of the deal is that everybody will be happy. Jihadists are awash with funds for operations and payments of assets, locality’s banks are awash with fresh cash that will then circulate back into the local economy, and happiest of all will be the peacekeepers whose purses and secret vaults will bulge with fresh funds. Everybody gets a lot of news exposures, the media personnel abducted will have tons of materials for new write ups and reportage, the paying group will project an angelic mien as philanthropic moguls worth your emulation.

Perhaps the insurance companies should cash in on terror abductions and attacks, and open up ‘terror insurance’ or maybe peg them as ‘force majeure’ with specifications applicable to terror-operated abductions. And, maybe they can even partner with wealthy peacekeepers to study the viability of hedge funds operations for abductions. Isn’t this a fantastic proposal?

[Writ 15 June 2008, Manila, Quezon City]