Is the Philippines getting richer?

As a resident facing the daily monstrous traffic and reading the bickering in the political field involving no less than the families of the top two officials of the land, one feels a sense of fatalism is in the air. We just lost an exceptional former senator in Atty. Rene Saguisag, and we wonder when we will see our Senate filled with honorable men and women again. On the surface, things appear bleak. It is thus pleasantly jolting to read, in The Economist no less, this recent piece which proclaims in its tagline, “Without fanfare, the Philippines is getting richer?”

Allow me to quote a few paragraphs from said article then later share my reflections: “Things are improving. Roads are being paved; bridges built. In February, the government picked a private consortium to revamp and double the capacity of Manila’s airport. Later this year, it is expected to award contracts to modernize several regional airports, too. Manila is scheduled to have its first underground metro line by 2029.”

“Growth has been brisk at around 6% a year since 2012 (except during the pandemic). The economy has quietly boomed under a variety of administrations. The World Bank says the Philippines will soon be an upper middle-income country.”

“It has handy sources of foreign currency that may be Trump-proof. One is remittances from its 2 million citizens working abroad, steering ships or nursing patients in the Gulf. They send home the equivalent of 9% of GDP (gross domestic product) a year, a cash gusher that flowed steadily even during the pandemic.”

“Another source of dollars is tourism, which could boom when the airports imports improve. The Philippines has enormous untapped potential: warm weather, pristine beaches, coral reefs to snorkel over and a culture of hospitality.”

“The third source of resilience is exports of services which may be less affected by a future trade war than physical goods. With their fluent English and familiarity with baseball, Filipinos call-center workers are much in demand by American firms. The country’s business process outsourcing firms employ more than 1.7 million people.”

The mention of Trump in the article is an allusion to worries about another Donald Trump presidency which can impose tariff hikes that can affect exports of electronic goods. The article points that despite emerging issues related thereto, the Philippine economy is well-defended against American politics, and this is reassuring if correct.

“Many of the reasons for optimism about the Philippines have nothing to do with who is in charge. The country is at a demographic sweet spot, with a bulge of working-age citizens. With half of its people still living in the countryside, there is plenty of potential to shift from farming to better paid jobs.”

To be fair, the article did give credit to the present administration which it characterized as more competent than the predecessor. The incumbent’s economic team are mostly technocrats and is widely praised. “Governance matters too, and so far, Mr. Marcos is nowhere near as bad as many observers feared.” He has continued to upgrade the infrastructure linking the archipelago’s 7,600 islands to each other and the world. He has improved respect for human rights, too.

Living in our country, we are exposed to daily media barrage on the state of our traffic, the quality of our politics, the reliability of news source, the abundance of false news, unemployment and underemployment, poverty, lack of social protection for workers and retirees, etc. Respected columnist Randy David recently wrote this: “What appear to be the key events of our time lack substance and depth. Our days are filled with posturing and representations that stand for reality itself, while containing a measure of vagueness (and thus deniability) as to their ultimate meanings. But, in ironic acceptance of what we can’t change, no one seems to mind.”

There is a tendency to be discouraged and lost in the forest confronted with the myriad of problems of daily life. Thus, to read about improvements from an objective outside source should reassure us that the future has promise. There is still hope.

Of course, there will continue to be challenges, like the geopolitics of conflicts elsewhere, the rift with China and some antiquated laws on investment. But the view of the forest from above tells us there is hope for the country. We may not have a perfect leadership in place, but the sense of guarded optimism about our future is welcome.

Many of my contemporaries who had a chance to personally witness the miracle of EDSA have been jaded by the politics in the country post those euphoric days. But if there is something positive to note, we are still blessed and there is no doubt in my mind that the Filipino spirit will triumph in the end. It may be taking the country longer and with many detours, but it will happen.

Still this column hopes to see us gaining ground, improving economically and truly getting richer in our national spirit as well. At the end of the day, we must be mindful of how we can contribute to this destiny. If we harness our time, talent, and treasure towards progress, it will all add up to making this country truly rich.

The views expressed herein are the author’s own and do not necessarily reflect the opinion of his office as well as FINEX.

Benel Dela Paz Lagua was previously EVP and chief development officer at the Development Bank of the Philippines.  He is an active FINEX member and an advocate of risk-based lending for SMEs.  Today, he is independent director in progressive banks and in some NGOs. The views expressed herein are his own and does not necessarily reflect the opinion of his office as well as FINEX.