Balancing the economy with peace and order

It’s just too bad that President Duterte missed a great opportunity to launch the country’s “Dutertenomics roadshow” before the international community because of the situation in Marawi City. The two-day Nikkei 23rd International Conference on the Future of Asia in Japan would have been a very good platform to promote the country’s infrastructure agenda as he was supposed to deliver the closing speech on June 6.  For a while, it was a touch-and-go situation, but it’s confirmed that Foreign Affairs Secretary Peter Cayetano will attend instead of the President.

In any case, the President should still go to Japan to meet with Emperor Akihito and Prime Minister Shinzo Abe. Emperor Akihito is expected to abdicate on his 85th birthday in December next year to give way to Crown Prince Naruhito. The Japanese government recently passed a bill allowing the abdication – the second time for a Japanese monarch to renounce the throne with the last one happening in 1817 when Emperor Kukaku stepped down.

The meeting with Prime Minister Abe will be very important as it will be an opportunity to discuss bilateral issues and strengthen the partnership between the two countries. Japan is the Philippines’ top trading partner, with an estimated $18.7 billion in total bilateral trade as of 2015. It is also the country’s biggest official development assistance contributor, with at least three massive infrastructure projects already in the pipeline. One of them is the P227-billion Mega Manila Subway project that people are waiting for to relieve them from the continually worsening traffic congestion in Metro Manila. President Duterte and Prime Minister Abe are set to sign the agreement this November.

However, business prospects are in limbo following the declaration of martial law in Mindanao, with potential investments on hold as investors adopt a wait-and-see attitude regarding developments in Marawi City, with government troops battling Maute and Abu Sayyaf terrorists.

No one will argue that terrorism has become a global problem especially with the Islamic State of Iraq and Syria (ISIS) spreading its tentacles overseas, cultivating radical followers and “lone wolves” through aggressive recruitment and propaganda activities in cyberspace to establish a “virtual caliphate” beyond Iraq and Syria. ISIS has claimed responsibility for the suicide bombing in Manchester where most of the victims were families and young people. A double suicide bombing in Jakarta is also believed to be the handiwork of ISIS.

The intelligence information that we have been receiving since last year confirms that ISIS is eyeing Mindanao as the extension of its caliphate in Southeast Asia to make up for the strongholds it recently lost in the Middle East. Events in Marawi City point to the validity of the information, with the Maute terrorists coming to the aid of Abu Sayyaf leader Isnilon Hapilon who in 2014 pledged his allegiance to ISIS. The hoisting of the black flags of ISIS, plus the presence of foreign terrorists among those killed in Marawi, certainly underscores the link between local terrorists and international extremists.

Many Filipinos, particularly Mindanaoans, believe the President was justified in declaring martial law – with many convinced that the move is long overdue considering the decades of lawless violence that has displaced hundreds of thousands in conflict-affected areas.

While the military is certain it will be able to contain the Maute group – with latest reports indicating that government troops have reclaimed 90 percent of Marawi, there is no arguing that economic growth and prosperity is the only way to achieve meaningful and lasting peace in a region that has been dubbed as “no man’s land” – where grinding poverty has forced many to turn to kidnapping, looting, banditry and other criminal activities in order to support their families.

Coming from Mindanao himself, the President is certainly cognizant of the problems besetting the region and has kept it from realizing its full economic potential. That is also why President Duterte’s socioeconomic agenda prioritizes Mindanao, with development programs aimed at speeding up inclusive growth and transforming the economy into one that is pro-poor. For sure, the government’s massive infrastructure program in the next five years is the best way to counter terrorism and rebellion because the projects will create jobs and spur development in many areas outside of Metro Manila

But let’s also face it – the country needs a lot of funding to implement the administration’s massive economic and infrastructure agenda. The President may rail against certain countries and institutions, but there is no denying the help they have extended. In fact, not many know that the upgrading of Davao International Airport was co-funded by the European Investment Bank, or that the European Union has been providing development assistance to support peace efforts in Mindanao.

It, therefore, came as a surprise to many that Finance Secretary Sonny Dominguez has encouraged the President to reject aid from the EU because it supposedly comes with strings attached. However, EU Ambassador Franz Jessen said the assistance comes only with standard conditions that are not related to human rights issues.

Hopefully, the President recognizes the need to balance the peace and security situation with economic growth and development – which is why the administration’s economic managers have to work doubly hard to convince the international community that the Philippines is on track as far as economic growth is concerned. We can also learn from the example of nations such as Venezuela – an oil-rich country whose economy is now in shambles because its late president Hugo Chavez spurned private businesses and rejected help from other nations.  Of course, we are not yet in that situation, but if we do not balance peace and security efforts and how it impacts the economy, we could go south (no pun intended) like what happened to that Latin American nation.

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