Thursday, November 16, 2006
Economic Reforms and Constitutional Amendments
Most of the dust over the People Initiative efforts to amend the Constitution has now settled. Well, at least for round one, it is for the most part, over. The opposing sides on the issue are, however, still voicing out opinions, eternally arguing, the proponents coming up with new efforts to continue the battle while the detractors try to outsmart them by putting out road blocks and killing the effort. Same old stuff, different day. Everyday that passes, the opportunity to address the issue of reform gets buried deeper.
Bottom line ladies and gentlemen, between the two opposing sides’ opinions and desired goals, which one is going to put more money in our pockets and more food on our tables? This in essence, holds the most water above all the arguments and bickerings that are going on. Which side is going to feed us, our children and grandchildren in the days to come?
Former President Ramos who has backed Charter Change for a long time has expressed his disappointment over the Supreme Court’s decision on the fate of the People Initiative.
He said that the SC made their decision on the Initiative based on technicalities and not on its desired merits. He stressed Economic Reforms as one of the biggest reasons why the Constitution needs to be overhauled. One specific economic reform is the removal of most of the restrictions on FOREIGN OWNERSHIP of businesses by foreign investors who want to do business in the Philippines. I cannot argue with this one. He is absolutely right.
The old belief in many quarters of our nation that opening the Philippines to foreign investment and foreign ownership of businesses is detrimental to our own national interest is indeed OLD and BACKWARDS. Yet this same sentiment is still repeated in many discussions and still believed by many as ‘the truth’.
China languished in the third world status for ages until Deng Xiao Peng in 1978 opened the nation to foreign investment. By this , he REMOVED most if not all of the restrictions that the old regime imposed in the past and in its place installed reforms favorable to foreign investors. His was not an original idea. For years before China’s economic rise, Singapore, Hong Kong, Taiwan, Malaysia and the rest of the richer Asian countries have all removed or at least modified their policies so that foreign investors felt more assured of their ability to operate freely while running and owning a business in their particular country. In less than 15 years after China ‘opened’ their country to foreign investment, they were well under way to becoming one of the richest nations in the world. Now, almost 30 years later, they are indeed very, very rich.
What about the Philippines? The Philippines is the LAST HOLDOUT on foreign business ownership and this folks is one big obstacle that needs to GO or should have GONE like years ago. As former President Ramos said, all the positive ratings that the world gives us are an indication that we are doing many things right at this time. But these things we are doing right are not going to lead us to more wealth if we do NOT open the door wider for investment to come in and STAY in.
We have done a good job in collecting more taxes through the EVAT and it is paying off. We now have more money to work with. We will be able to spend more money on projects that create more jobs. WE need to continue showing the foreign investors that we want them and their money IN the Philippines . We however cannot keep saying this without taking concrete actions to make investment in the Philippines foreign-investor friendly.
As we speak, foreign businesses are still required to partner up with Philippine companies who will own 60% of the businesses and the foreign company will own 40%. With the Philippines’ track record of corruption in mind, foreign businesses are not too eager to do business with us with only 40% ownership and control of their company. Our Asian neighbors have but removed all these restrictions and allowed the foreign investors a free hand to operate businesses in their countries. Most of our Asian neighbors are wealthy and we are still very, very poor. This observation alone should help us decide which route to take.
Parliamentary versus Presidential? I look at two nations , the United States and England.
Both are wealthy. The former has the Presidential system and the latter, the Parliamentary system. So, is the Philippines better off with a Parliamentary system? As our example above shows, either system works! It is HOW we run these systems that really matter folks! It is HOW we DO things while running our government, parliamentary or presidential.
My observation: Our leadership, all of them, need to learn how to pull together and rally behind what needs to be done first before we can truly move on and accomplish bigger objectives. With the exception of a few, the motivations behind MOST of the maneuverings in our government right now do not have anything to do with any national goals that will benefit all. It has more to do with power struggles, personal ambitions, protecting personal, political and financial interests, greed. When this same leadership (or the absence of it) puts all this selfish reasons for their activities behind them and replaces them with goals that will dramatically push our ECONOMY at the forefront of their priority list, then maybe we can indeed start becoming a wealthy nation. Until then, a new government system will not really help that much.
So, amending the Constitution and overhauling its policies on FOREIGN INVESTMENT is one of the single biggest goal that our leaders should focus on and this is one of the single biggest achievement that they will ever accomplish for our country.
Course of Action for the citizens: As individuals or groups, continue to back our economic reformers. Back the reforms that will bring in FOREIGN MONEY into our homeland. The call centers are a good example of foreign money from foreign investors. These call centers hire local employees who get very decent pay. These employment dollars help raise our economy just as the dollars remitted by the millions of OFW’s help strengthen our economy and raise our living standards. But these call centers and OFW remittances alone are not enough. We need to CONSISTENTLY attract more businesses across the board. Attract investors in all sectors of industry.
I truly do not buy the notion that the leadership behind the People Initiative petition to amend our Constitution had deception in their minds when they initiated the collection of signatures. In many quarters supporting the effort, economic reform to attract foreign investment was at the forefront of most of their discussions. Governor Aumentado of Bohol, who is one of the leaders pushing for People Initiative, is doing a super job in modernizing his province and doing many things to attract new investment. Bohol is following Cebu’s footsteps in creating wealth for itself and its people. It is not a big surprise to see him drum up efforts to radically change the foreign investment atmosphere for the Philippines. When the Philippines finally lifts most of its restrictive trade barriers or laws that are in our present Constitution, he knows that his province and most of the provinces that have prepared well, are lined up to fully benefit from it. Governor Aumentado is an ENTREPRENEUR at heart. We need to watch very closely what he does and perhaps learn from him.
And the fear that President Arroyo will continue to sit in power if somehow the Parliamentary system replaces the present system before her term is over in 2010, is understandable but on closer scrutiny does not make sense. The fear is understandable because we lived under martial rule for 20 years and under that government , our nation went from ‘bad to terrible’. No one wants a change in government where a leader who is not performing well continues to rule.
The fear does not make sense for the very reason that in terms of the economy, President Arroyo has accomplished more than most Presidents of the past and continues to display leadership qualities that pull in more economic gains for the country. The fiscal reforms that she has instituted so far have allowed our economic situation to improve, the peso continues to rise, some very favorable ratings have been given to us and even the World Bank has given us its ‘thumbs up’. Even some of her critics recognize that the President has hurdled most of the obstacles that most past Presidents have failed to hurdle.
Try taking over the Presidency of a nation which is BROKE, has Billions of dollars in debt, has a very corrupt bureaucracy and political system, its tax collection a mess, has two or more insurgencies to deal with and see how fast you sink to the bottom. Our fiscal problems will not disappear overnight. But our economy through this President’s leadership is making some inroads in places where others got stuck or went downhill. The longer we block the changes to bring in FOREIGN INVESTMENT into our country, the longer we will stay poor. We need to swing the doors WIDE OPEN and we will see our economy grow faster.
So, if you ask me, unless we have anybody out there who is as equally capable as this President or better in improving our economy, I would choose to have her continue her job any day. As it is, I don’t know of anyone or at least has not observed a soul from the line up of potential successors who can outdo what she is accomplishing for us economically. So, if she sits in the highest seat of office in the Philippines whether it is a Presidential system or Parliamentary past 2010, I simply cannot associate this thought to anything that is dreadful.
The whole effort and responsibility to improve our economy do not lay in her hands alone. It takes everyone rowing together to move this nation forward. The rest just needs to row in the same direction. The direction to national wealth. Her detractors who continue to sow horror stories on what could happen if she stays in power past 2010 do not have a good handle on what the most important issue really is. ‘It’s the ECONOMY…st…d.’
One very popular multimillionaire who came from a very poor and humble beginnings said, “Wealth is a mindset. Until you learn how to think RICH you will continue to be poor, think poor and act poor. The way to riches is first to change your mindset and start thinking RICH. You then follow it up with ‘RICHLY’ actions! And then wealth will follow”. And this is true for our nation. Everyone is preoccupied with many things except things that will make us rich as a nation. Our culture has not learned how to have the mindset of true entrepreneurs. We THINK and ACT poor. If this is not true, look around and see who is the poorest country in the Asian neighborhood. Well, we are. We remain the economic ‘chickens’ of Asia and our economy has started to look good but still stinks as compared to our neighbors’ economy. We don’t dare compete with our Asian neighbors economically instead we compete among ourselves over the most stupid things.
Some of the people who are ‘scared stiff’ of changes like Constitutional amendments or Charter Change are operating from this kind of mindset. Horror stories of what could happen if these changes are brought in are their favorite. The more people they tell of this dreadful story the more they scare themselves to death. So, do us a favor. Knock off the bs, get in line and help push this economy forward. You could then one day congratulate yourself for having made a contribution to helping our economy look good and even smell good.
Joe Joson
California
For feedback: blackhawk74@yahoo.com or visit my blog at
http://www.catanduaneseconomy.blogspot.com
Bottom line ladies and gentlemen, between the two opposing sides’ opinions and desired goals, which one is going to put more money in our pockets and more food on our tables? This in essence, holds the most water above all the arguments and bickerings that are going on. Which side is going to feed us, our children and grandchildren in the days to come?
Former President Ramos who has backed Charter Change for a long time has expressed his disappointment over the Supreme Court’s decision on the fate of the People Initiative.
He said that the SC made their decision on the Initiative based on technicalities and not on its desired merits. He stressed Economic Reforms as one of the biggest reasons why the Constitution needs to be overhauled. One specific economic reform is the removal of most of the restrictions on FOREIGN OWNERSHIP of businesses by foreign investors who want to do business in the Philippines. I cannot argue with this one. He is absolutely right.
The old belief in many quarters of our nation that opening the Philippines to foreign investment and foreign ownership of businesses is detrimental to our own national interest is indeed OLD and BACKWARDS. Yet this same sentiment is still repeated in many discussions and still believed by many as ‘the truth’.
China languished in the third world status for ages until Deng Xiao Peng in 1978 opened the nation to foreign investment. By this , he REMOVED most if not all of the restrictions that the old regime imposed in the past and in its place installed reforms favorable to foreign investors. His was not an original idea. For years before China’s economic rise, Singapore, Hong Kong, Taiwan, Malaysia and the rest of the richer Asian countries have all removed or at least modified their policies so that foreign investors felt more assured of their ability to operate freely while running and owning a business in their particular country. In less than 15 years after China ‘opened’ their country to foreign investment, they were well under way to becoming one of the richest nations in the world. Now, almost 30 years later, they are indeed very, very rich.
What about the Philippines? The Philippines is the LAST HOLDOUT on foreign business ownership and this folks is one big obstacle that needs to GO or should have GONE like years ago. As former President Ramos said, all the positive ratings that the world gives us are an indication that we are doing many things right at this time. But these things we are doing right are not going to lead us to more wealth if we do NOT open the door wider for investment to come in and STAY in.
We have done a good job in collecting more taxes through the EVAT and it is paying off. We now have more money to work with. We will be able to spend more money on projects that create more jobs. WE need to continue showing the foreign investors that we want them and their money IN the Philippines . We however cannot keep saying this without taking concrete actions to make investment in the Philippines foreign-investor friendly.
As we speak, foreign businesses are still required to partner up with Philippine companies who will own 60% of the businesses and the foreign company will own 40%. With the Philippines’ track record of corruption in mind, foreign businesses are not too eager to do business with us with only 40% ownership and control of their company. Our Asian neighbors have but removed all these restrictions and allowed the foreign investors a free hand to operate businesses in their countries. Most of our Asian neighbors are wealthy and we are still very, very poor. This observation alone should help us decide which route to take.
Parliamentary versus Presidential? I look at two nations , the United States and England.
Both are wealthy. The former has the Presidential system and the latter, the Parliamentary system. So, is the Philippines better off with a Parliamentary system? As our example above shows, either system works! It is HOW we run these systems that really matter folks! It is HOW we DO things while running our government, parliamentary or presidential.
My observation: Our leadership, all of them, need to learn how to pull together and rally behind what needs to be done first before we can truly move on and accomplish bigger objectives. With the exception of a few, the motivations behind MOST of the maneuverings in our government right now do not have anything to do with any national goals that will benefit all. It has more to do with power struggles, personal ambitions, protecting personal, political and financial interests, greed. When this same leadership (or the absence of it) puts all this selfish reasons for their activities behind them and replaces them with goals that will dramatically push our ECONOMY at the forefront of their priority list, then maybe we can indeed start becoming a wealthy nation. Until then, a new government system will not really help that much.
So, amending the Constitution and overhauling its policies on FOREIGN INVESTMENT is one of the single biggest goal that our leaders should focus on and this is one of the single biggest achievement that they will ever accomplish for our country.
Course of Action for the citizens: As individuals or groups, continue to back our economic reformers. Back the reforms that will bring in FOREIGN MONEY into our homeland. The call centers are a good example of foreign money from foreign investors. These call centers hire local employees who get very decent pay. These employment dollars help raise our economy just as the dollars remitted by the millions of OFW’s help strengthen our economy and raise our living standards. But these call centers and OFW remittances alone are not enough. We need to CONSISTENTLY attract more businesses across the board. Attract investors in all sectors of industry.
I truly do not buy the notion that the leadership behind the People Initiative petition to amend our Constitution had deception in their minds when they initiated the collection of signatures. In many quarters supporting the effort, economic reform to attract foreign investment was at the forefront of most of their discussions. Governor Aumentado of Bohol, who is one of the leaders pushing for People Initiative, is doing a super job in modernizing his province and doing many things to attract new investment. Bohol is following Cebu’s footsteps in creating wealth for itself and its people. It is not a big surprise to see him drum up efforts to radically change the foreign investment atmosphere for the Philippines. When the Philippines finally lifts most of its restrictive trade barriers or laws that are in our present Constitution, he knows that his province and most of the provinces that have prepared well, are lined up to fully benefit from it. Governor Aumentado is an ENTREPRENEUR at heart. We need to watch very closely what he does and perhaps learn from him.
And the fear that President Arroyo will continue to sit in power if somehow the Parliamentary system replaces the present system before her term is over in 2010, is understandable but on closer scrutiny does not make sense. The fear is understandable because we lived under martial rule for 20 years and under that government , our nation went from ‘bad to terrible’. No one wants a change in government where a leader who is not performing well continues to rule.
The fear does not make sense for the very reason that in terms of the economy, President Arroyo has accomplished more than most Presidents of the past and continues to display leadership qualities that pull in more economic gains for the country. The fiscal reforms that she has instituted so far have allowed our economic situation to improve, the peso continues to rise, some very favorable ratings have been given to us and even the World Bank has given us its ‘thumbs up’. Even some of her critics recognize that the President has hurdled most of the obstacles that most past Presidents have failed to hurdle.
Try taking over the Presidency of a nation which is BROKE, has Billions of dollars in debt, has a very corrupt bureaucracy and political system, its tax collection a mess, has two or more insurgencies to deal with and see how fast you sink to the bottom. Our fiscal problems will not disappear overnight. But our economy through this President’s leadership is making some inroads in places where others got stuck or went downhill. The longer we block the changes to bring in FOREIGN INVESTMENT into our country, the longer we will stay poor. We need to swing the doors WIDE OPEN and we will see our economy grow faster.
So, if you ask me, unless we have anybody out there who is as equally capable as this President or better in improving our economy, I would choose to have her continue her job any day. As it is, I don’t know of anyone or at least has not observed a soul from the line up of potential successors who can outdo what she is accomplishing for us economically. So, if she sits in the highest seat of office in the Philippines whether it is a Presidential system or Parliamentary past 2010, I simply cannot associate this thought to anything that is dreadful.
The whole effort and responsibility to improve our economy do not lay in her hands alone. It takes everyone rowing together to move this nation forward. The rest just needs to row in the same direction. The direction to national wealth. Her detractors who continue to sow horror stories on what could happen if she stays in power past 2010 do not have a good handle on what the most important issue really is. ‘It’s the ECONOMY…st…d.’
One very popular multimillionaire who came from a very poor and humble beginnings said, “Wealth is a mindset. Until you learn how to think RICH you will continue to be poor, think poor and act poor. The way to riches is first to change your mindset and start thinking RICH. You then follow it up with ‘RICHLY’ actions! And then wealth will follow”. And this is true for our nation. Everyone is preoccupied with many things except things that will make us rich as a nation. Our culture has not learned how to have the mindset of true entrepreneurs. We THINK and ACT poor. If this is not true, look around and see who is the poorest country in the Asian neighborhood. Well, we are. We remain the economic ‘chickens’ of Asia and our economy has started to look good but still stinks as compared to our neighbors’ economy. We don’t dare compete with our Asian neighbors economically instead we compete among ourselves over the most stupid things.
Some of the people who are ‘scared stiff’ of changes like Constitutional amendments or Charter Change are operating from this kind of mindset. Horror stories of what could happen if these changes are brought in are their favorite. The more people they tell of this dreadful story the more they scare themselves to death. So, do us a favor. Knock off the bs, get in line and help push this economy forward. You could then one day congratulate yourself for having made a contribution to helping our economy look good and even smell good.
Joe Joson
California
For feedback: blackhawk74@yahoo.com or visit my blog at
http://www.catanduaneseconomy.blogspot.com
