Diokno Present Stats @ an Austrian business community

ROAD MAP: The assessment of Dr. Benjamin Diokno, UP economics professor, of the country’s economic performance midway through President Aquino’s term points to a challenge for the administration to do better in the final three years of his presidency.

“Where’s the road map?” asked Diokno, a former Secretary of Budget and Management, as he assessed the economy before Austrian businessmen and their Filipino partners gathered last Thursday at the Makati Shangri-La.

The meeting was organized by Austrian Commercial Counsellor Lisa Viehhauser. It was also an occasion for the Austrian business community to welcome new Austrian Ambassador Josef Müllner.

After painting a not-so-encouraging economic picture, Diokno said: “What is lacking is decisiveness, policy consistency and policy credibility.”

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UNSUSTAINABLE GROWTH: Diokno gave statistics showing that the Philippines grew at 7.6 percent in the first semester, but remains to be the poorest among the original five members of the Association of Southeast Asian Nations.

The 7.6-percent growth is not sustainable, he said, noting that even Aquino’s economic managers agree. He added that the Gross Domestic Product in the second half of 2013 will decelerate because of a still weak world economy and the tapering off of effects of election spending.

He said the Philippines remains to be the poorest among the original ASEAN-5 economies. In World Bank reports for 2012, the per capita Gross National Income of the five nations is: Singapore $47,210, Malaysia $9,800, Thailand $5,210, Indonesia $3,420 and Philippines $2,470.

The Philippines ranks the highest in poverty incidence among the ASEAN-5 economies. In the CIA World Factbook, the comparative poverty rankings of the five are: Philippines 83; Indonesia 133; Thailand 147; Malaysia 156; Singapore 211.

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DEEPENING POVERTY: Based on data of the National Statistics Coordination Board, the poverty situation in 2012 appears to be unchanged from 2006 and 2009. But in terms of warm bodies, poverty has deepened.

The NSCB reports that there are 463,000 more poor people now than in 2009. “And we all know that because of the world economic crisis, 2009 was a bad year,” Diokno said.

Among the ASEAN-5, the Philippines has the worst unemployment record. While the unemployment rate was falling among its ASEAN-5 neighbors, it was rising in the Philippines.

Bangko Sentral ng Pilipinas data show that unemployment in the ASEAN-5 for 2012 and the first and second quarters of the current year was: Philippines 7.0 percent (2012) and 7.1 (Q1), 7.5 (Q2); Malaysia 3.0% (2012), 3.2 (Q1), 3.2 (Q2); Indonesia 6.4 % (2012), 5.9 (Q1); Thailand 0.7% (2012), 0.7 (Q1); and Singapore 2.1% (2012), 1.9 (Q1).

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NOT INCLUSIVE: Diokno said that whatever growth there was, it was not inclusive. Government figures show that the number of jobless Filipinos this year stood at: (January) 2,894,000 unemployed and 7,934,000 underemployed; (April) 3,086,000 unemployed and 7,252,00 underemployed; (July) 3,000,000 unemployed and 7,341,000 underemployed.

A recent World Bank study showed that by the time President Aquino steps down in 2016, the state of unemployment will be as dismal as it was before he assumed the presidency – if not worse.

The study forecast that 12.4 million Filipinos, or 11.5 percent of projected population by then “would still be unemployed, underemployed, or would have to work in the informal sector where moving up the job ladder is difficult.”

Diokno said unemployment is a form of “market failure,” adding that there is need for government intervention.

He said one challenge for government is to create around 14.6 million jobs in the next four years. In addition, it should create better jobs for the other 21 million who are informally employed.

source:  Philippine Star Column Postcript by Federico Pascual