The pandemic, the economy and China

THE CORNER ORACLE - Andrew J. Masigan (The Philippine Star) - August 5, 2020 - 12:00am

As a family man, an entrepreneur and a Filipino, I hoped that the President’s State of the Nation Address (SONA) would provide rhyme and reason to all the disruption going on. I am not alone when I say that I fear for my family’s health, I fear for the future of our  businesses and I worry about the country’s economy. I was hoping that the SONA would provide an accurate assessment of our health and economic situation and a sensible plan to get out of it. Now more than ever, the President must settle insecurities and provide assurances that government is in control.

I earnestly wanted him to be the leader that we need at this time. But alas, it seems the temptation to be populist was too great for him to resist. Instead of easing nerves, the President, once again, pitted the masses against the elite in an effort to pander to his base of followers. It was a reckless act since now is the time to unite the nation, not divide it. To indulge in politicking, in a time of crisis, leaves a foul taste in the mouth. I reckon the populist rhetoric was meant to make up for the botched-up anti-Covid response.

Of course, no SONA would be complete without paying homage to China and Bong Go. Hearing it again provided comical relief.

On the positive side, however, I appreciated his endorsement of the CREATE bill. Its passage is vital for our economic recovery. I also approve of the Nursing Education Act, the law instituting Medical Reserve Corps and the establishment of a National Disease Prevention Authority. These laws will better prepare us for the next pandemic.

Another good initiative is the proposed establishment of the Department for Overseas Filipinos. For all the contributions of our OFWs, they deserve a dedicated department to cater to their legal, financial and security needs.

On the economy, the scale and speed in which the economy has deteriorated, coupled with its inability to fully restart,  is one of our causes of anxiety. Unfortunately, the President failed to spell out our recovery roadmap as we hoped he would.

Many factors point to a long U-shaped recovery or worse, a prolonged L-shaped depression. First among these factors is the closure of thousands of MSMEs due to the lack of financial lifelines going their way. The P182.5 million in loans disbursed to 2,600 MSMEs will hardly make an impact since their needs are in the hundreds of billions. If the MSME sector collapses, the entire economy will collapse along with it.

Second is government’s failure to  cascade the stimulus funds due to the lack of absorptive capacities of government institutions, inefficiency and corruption. Third is that consumer confidence remains abysmal. We are a consumer-driven economy wherein 72 percent of economic output is attributed to private consumption. Consumer demand must pick up in order for the rest of the economy to follow.

I hoped to hear how government was to address these issues. Unfortunately, the President provided no solutions. He did, however, appeal to the banks not to levy penalties on businesses unable to pay for their loans. To lessors, he appealed for more leniency on rental defaults. I say, it should have been a directive and not an appeal. Banks and landlords are profit-driven and will likely ignore a simple appeal unless it comes with consequences.

On addressing the pandemic, it was obvious that the President is pinning his hopes on the development of a vaccine and is resigned to just ride it out until then.

While he admitted that the anti-virus program of government is far from perfect, he failed to provide an alternative to the present strategy, not even on the all-important (and basic)  process of data gathering. Data is where all decisions originate and ours is inaccurate. This is one of the reasons why our anti-Covid response is the most ineffective in the region. Neither can we expect the replacement of the scandalously incompetent Secretary Francisco Duque. He serves as the President’s fall guy.

A nationwide crisis like Covid-19 reveals the quality of our leadership.  Lamentably, ours is confused, incoherent and now feeling persecuted, given the public uproar on the state of affairs. Government has even resorted to blaming the LGUs, the public and even our tired health professionals for its failure. We know that the IATF is tired too. Perhaps the best thing to do is to bring in new advisers with fresh insights. Certainly, there must be a member of the economic team in the IATF.

But what bothered me the most about the SONA were the President’s remarks  over China’s illegal occupation of the West Philippine Sea.

The fact that he referred to the territory as the “South China Sea” makes me think that he is reading from China’s playbook.

He further said that since China is in possession of the territory, he can do nothing except to let them be lest we be obliterated in armed conflict. Mind you, this was not the first time in which this narrative was delivered in a SONA. How it found its way to the script again is cause for speculation.

That said, the premise of the President’s statement is wrong because China does not have legal possession of the West Philippine Sea… we do! This was validated by the United Nation’s ITLOS court, no less. Neither does China have physical possession of the entire West Philippine Sea. The Philippine Navy and Coast Guard still patrol a large chunk of it.

He described himself as “inutil” (useless/helpless) in the West Philippine Sea issue. He is making it sound as if we have no option but to concede our sovereign territories to China. Again, this is wrong, not to mention misleading.  There are legal and diplomatic options to take if he really wanted to safeguard our sovereignty. Other claimants to the disputed territories like Vietnam and Malaysia have gone on a full diplomatic offensive to protect their respective sovereignties. President Nguyen Phú Trong and Prime Minister Muhyiddin Yassin are not inutil, they are patriots.

It stings acerbically to have our own President succumb to China so easily and so willingly. If I were to be honest… I feel betrayed by my own government.

The President’s mystifying devotion to China negates all the positives of his government. What good is infrastructure, economic and social development if all are ceded to China on a silver platter? How can we be expected to trust this administration if it  refuses to fight for what is ours?

All these have made the SONA uninspiring, disappointing and disturbing.

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