Inclusive growth: Widely missed in 2013

“When defeat comes, accept it as a signal that your plans are not sound, rebuild those plans, and set sail once more toward your coveted goal.” So said, Napoleon Hill, author of the landmark bestseller, Think and Grow Rich.  There are no phrases better than this that could be attributed to as far as our dreamed “inclusive growth” is concerned.  We’ve always failed.  Worst, each new administration builds an entirely different one, then sail.  Each succeeding administration never care to study why the previous one failed.  Thus, the vicious cycle of building, sailing and failing continues.  So that, until today, the dreamed “inclusive growth” remained as such, a dream.

Truth to tell, despite a very much maligned Arroyo administration, our economy parlayed the 2008-2009 recession better than our other Asian neighbors.  Moreover, the boom in the outsourcing industry and the steadily increasing remittances from Overseas Filipino Workers (OFWs) have added impetus to a once sagging economy.  Consequently, our economy grew at a yearly average of 4.5% the past decade.  To PNoy’s credit, however, in his reign our GDP grew by 6.6% in 2012 and this year’s first half by 7.6%.  Despite the massive destructions in the Visayas brought about by the tremor and super typhoon Yolanda, the country may yet achieve this year’s projected 6% growth rate. 

Despite this rosy picture (both GMA’s & PNoy’s reigns), however, poverty has worsened.  Thus, our countrymen are wondering, why in heaven’s name we claim to have grown significantly in more than a decade and yet majority of our brethrens are languishing in poverty.  For one, economic growth is generally measured in terms of GDP.  Increase in GDP does not necessarily trickle down to the grassroots.  It simply means that the pace of growth is there but the path or pattern of growth does not cut through the working class or the masses.  To put it bluntly, we certainly have “economic growth” but, absolutely, there is no “inclusive growth.”

The truth is, we are not doing the right approaches.  The most tenable approach should have been through productive employment.  This can be addressed by encouraging new investments, both foreign and domestic.  Or, should the government must directly intervene, through productive-oriented supports to the most vulnerable sectors, like the agriculture sector.  Sadly, however, we pinned our hopes in the most ballyhooed cash transfer program or 4Ps, a program that is too counter-productive and clearly breeds parasites.  Thus, the program cannot put even a tiny dent in our worsening poverty incidences.   

If we continue with what we are presently doing, unemployment woes can only worsen.  Truth to tell, there are over 10 million who are unemployed or underemployed right now.  Each year, there are potentially over a million entrants to the labor market.  Therefore, if we won’t change our ways of doing things, the number of the unemployed and underemployed could easily reach almost 14 million by the end of PNoy’s term.  Thus, the need for fresh investments (whether foreign or domestic) as these will clearly help generate employment. 

On this, the latest World Bank initiated Ease in Doing Business survey did not help any.  As reported, in the area of “starting a business,” the country was ranked a low 170th.  At 170th place, we are among the bottom 20 of the 189 countries/economies included in the survey.  It simply means, both domestic and foreign investors have difficulties with our licensing and permitting systems and procedures.  Thus, are discouraged to invest.

True enough, we had our own share of foreign direct investments (FDIs).  Notably, however, most of these have been so focused only on business process outsourcing (BPO).  In fact, this is clearly manifested in the latest economic report which showed consistent growth in the service sector. Unfortunately, however, as far as inclusive growth is concern, the BPO sector does not contribute that much.  This sector employs not only the well-educated but the best among them.  Thus, they don’t directly give opportunities to individuals who are among the inadequately educated, the poorest of the poor, so to speak, who are mostly in the agriculture sector.

To the government’s credit (both GMA’s & PNoy’s reigns) though, it has addressed this concern by allocating billions of taxpayers’ money to support agriculture.  On record, through the Department of Agriculture, billions have been released to address our poor farmers’ concerns for decades.  Bastardly though, the support was just on record.  As the ongoing investigation of the “pork barrel” progresses, it is becoming more evident that while lawmakers (congressmen and senators alike) are enjoying their obesity of it, the poor farmers have perpetually starved for it.

For your comments and suggestions, please e-mail to foabalos@yahoo.com. (FREEMAN)