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Make no
mistake about it: the 6.9-percent GDP growth rate in the
first quarter of this year is a welcome development that
even the most jaded cynics and the unbelievers will find
hard to dispute.
The news
comes as a pleasant surprise. The government had
projected a 6.1-percent GDP growth rate for this year.
Last
week, Socioeconomic Planning Secretary Neri even said
that it would be difficult for the country to achieve a
6.2-percent economic growth in 2008 unless the
government would spend P20 billion more for pump-priming
activities. In this light, the 6.9-percent GDP growth
rate for the first quarter is seen as a “stunner,” to
quote one analyst.
Understandably, the Arroyo administration wants to tell
everyone within earshot that the economic turnaround is
due to its sound policies and prudent management.
The
country’s largest business organization, the Philippine
Chamber of Commerce and Industry, is optimistic that the
strong first-quarter economic performance will continue
for the rest of the year, saying that the President, her
economic team and the private sector really delivered in
rallying investors’ interest and confidence on the
economy.
It
predicted that “the economy is in for a more stable and
stronger growth in the next six months” and that this
would pave the way for the “elusive 7-percent growth in
the GNP” that the PCCI wanted.
The
business sector’s optimism is not misplaced considering
the stronger peso, a record-high PSE index, an
infrastructure budget of about P1 trillion, surging OFW
remittances, and increasing investments in
business-process outsourcing, tourism, property and
construction sectors.
All
this, the PCCI said, “will cause developmental effects
to create a more stable economy and a highly predictable
business environment benefiting the different sectors of
the economy.”
The
optimism is tempered, however, by proposals for the
government to implement reforms to improve the
macroeconomic environment, such as enhanced tax
collection and fiscal policies supporting pump-priming
activities and effective debt management.
The
surge in optimism is shared by another business group,
the Joint Foreign Chambers of Commerce of the
Philippines,
which has called on the legislature to pass four bills
deemed crucial for generating more jobs and enhancing
the country’s competitiveness.
These
measures seek to create a centralized credit bureau;
remove the requirement for importers to go through
brokers for transactions with Customs; establish a
corporation that would merge the functions of the
Philippine Convention and Tourism Corp., the Philippine
Tourism Authority and related units of the Department of
Trade and Industry; and promote renewable energy.
All
measures to sustain the momentum of economic growth are
worth supporting. At the same time, however, we urge
government to give priority to making the benefits of
growth trickle down to the poor. Improvements in the
economy should be matched with corresponding efforts to
attack poverty at the roots and ensure that economic
growth translates to a better quality of life for
Filipinos living in abject poverty.
Revamp the agency
Six
years on, the Electric Power Industry Reform Act of
2001, or Epira, has apparently neither lived up to its
goal of privatizing the industry nor can consumers, as
well as investors, expect relief from one of the highest
electricity rates in Asia.
The
appropriate question to ask, therefore, is whether the
National Power Corp. is deliberately taking its sweet
time in implementing the privatization effort.
The
wholesale electricity spot market, or WESM, was
conceived as a step toward lower electricity prices. But
Napocor has been tagged as the culprit in last year’s
price manipulation at WESM. Now, the agency seems to be
at it again, with electricity prices soaring by P2 per
kilowatt-hour (kWh) to P8 per kWh from P5.936 per kWh in
March.
The
price hike comes on the heels of the low capacity of
power plants running on cheaper fuels like coal, and the
simultaneous breaking down of Napocor’s antiquated
assets.
Then
there’s the reported emergency acquisition of coal by
Napocor from an Australian firm to the tune of $84 per
metric ton when the usual going price is $20 to $30 per
metric ton, to cope with an artificial crisis brought
about by the agency’s failure to anticipate high demand
for power during the scorching summer months. The
purchase is unnecessary because records indicate that
Napocor had already secured its 2007 coal requirements
last year.
Sen.
Aquilino Pimentel Jr. pointed out recently that
Napocor’s emergency purchase was unjustified. “They [Napocor
officials] should have foreseen the demand. It is not an
emergency. They are just creating an emergency situation
so that the high prices can be justified. Kawawa
naman ang bayan,” he said.
Energy
Secretary Raphael Lotilla recently ordered an inventory
of the total fuel supply needs of the country’s power
plants. This is a step in the right direction. But the
government should do more and determine if there’s plain
incompetence and mismanagement on the part of Napocor
officials. A revamp of the state-run firm might be just
what is sorely needed for ordinary consumers, as well as
industrial users, to get a respite from high electricity
rates. |
