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LEADERS
of the business community gave the President’s State of
the Nation Address (Sona) mixed reviews Monday, voicing
dismay that it rehashed her past promises, but
expressing hope that she would continue to steer the
country through greater economic challenges until 2010.
Sectoral
groups, meanwhile, said the speech appealed to
“technocrats” and political allies but did not offer
people any clear relief because, despite the long list
of planned infrastructure projects, economic policies
remained heavily reliant on borrowings, and spending
priorities were skewed.
Alberto
Lim, executive director of the Makati Business Club,
said the President only made more specific the projects
that she had already mentioned, and failed to make new
policy pronouncements on what her vision for the future
would be.
“It was
a rehash of existing projects. We were hoping for new
announcements, new directions,” Lim said.
Lim also
criticized the way President Arroyo tied the ongoing
projects with the congressmen and the other local
politicians close to her—seeing this as her way of
acknowledging and strengthening her political base.
The
businessmen were disappointed that she did not pick up
most of the suggestions they gave her, such as the need
for reforms in the financial sector, the fight against
corruption like the passage of the Freedom of
Information Act, and the reopening of Clark to foreign
airlines.
“She did
mention something on corruption but there was no real
substance,” Lim said.
He also
doubted the feasibility of the President’s financing
plan for her projects.
Philippine Chamber of Commerce and Industry (PCCI)
president Samie Lim, on the other hand, said the
President gave too much microinformation but missed the
big picture, “which is how we are vis-à-vis with other
countries.”
“She
failed to mention how can we grow faster because even if
we are growing, the other nations are growing faster
than us,” he said.
Still,
the PCCI head said the President gave the country better
credibility in the eyes of investors so that if the
Philippines is a company, its stocks would surely rise
after the Sona.
Francis
Chua of the Filipino-Chinese Chamber of Commerce and
Industry also praised the President’s address: “This is
one of the best. A lot of projects are on the way and
hopefully all the projects will be finished by 2010.
“The
President underscored that she will not give in to
anybody. Finally we have a chief of state who is very
strong. We have seen the light at the end of the
tunnel,” Chua said.
For the
Alliance of Concerned Teachers (ACT), education under
the Arroyo administration is a “lost decade.”
ACT
noted that almost all the performance indicators for
2005 are lower than the Medium Term Philippine
Development Plan’s 2002 baseline figures.
“It’s
reasonable to assume that the 2010 targets are already
beyond reach. At best, President Arroyo’s last three
years will be an exercise in damage control and
recovery—hopefully the basic education system can return
to its year 2000, the pre-Arroyo administration,
performance levels,” ACT said in a statement. The Arroyo
years—2001-2010, could very well turn out to be a lost
decade for education, it added.
ACT
cited the declining public spending on education, with
economic managers having strictly enforced the regime of
“limited or zero growth” in government spending on
education, “…for it is recommended by the World Bank and
ADB, in the wake of the 1997 Asian financial crisis, as
a means of taming the budget deficit and ensuring
continued debt payments.”
According to the Congressional Budget and Planning
Office, “the average annual growth rate of the DepEd’s
budget in real terms from 2001-2006 has been negative
3.5 percent.”
Furthermore, it noted that “in terms of share of the
national budget, [the 2007] DepEd budget represents one
of the lowest at 11.96 percent since 1995.”
Reflecting the poor performance on education, they said,
are the decline in the basic education enrollment,
failure to expand access to basic education, the rise in
the number of dropouts, low achievement levels of
students in national tests, shortages of classrooms and
teachers, and worsening pay and working condition of
teachers.
Data
gathered by ACT showed the Arroyo administration is
spending a mere 2.42 percent of GDP on education—down
from 2.99 percent in 2003.
They
urged the President to dramatically increase public
spending for education over the next three years.
On
health reforms, meanwhile, the Department of Health (DOH)
doubted the 14th Congress would try hard to approve the
Cheaper Medicines Act that was previously bypassed by
the Lower House allegedly because of a strong lobby by
pharmaceutical companies.
“Even if
they refile the bill, I’m not even hopeful. I hope
Congress will prove me wrong,” said Alexander Padilla,
DOH undersecretary, said in an interview.
He added
that despite the DOH’s “consistent” campaign to lower
the prices of medicines in the market, multinational
drug companies “still have gotten their ways” because
“Congress has not been legislating.”
“They’re
more concerned with their pork barrel, nothing else.
They are not interested [with this] because it’s a big
stumbling block to their pork barrel,” he said.
Padilla
called “scandalous” the pricing of drugs by foreign
pharmaceutical firms in the
Philippines
compared to those sold in other countries.
Padilla
said 70 percent of the Philippine’s drug market is
controlled by multinational firms.
Meanwhile, debt activists also played down the economic
feats of the administration, including the strengthening
of the peso and robust stock market.
“The
Freedom from Debt Coalition [FDC] continues to assert
that Mrs. Arroyo’s economic governance is defective in
all significant aspects of human development. Her
so-claimed economic growth never really benefited the
poor majority, and had only resulted into pushing the
common Filipino further into a struggle for desperate
survival,” FDC said.
Her
administration relies too heavily on borrowings; while
her spending policy is “procreditor and
antidevelopment.”
The FDC
assailed her government’s inordinate priority for “debt
service above all,” noting that: Interest payments as
percent of GDP grew to 5.5 percent in the last two years
(2005 and 2006) from 3.6 percent in 1999. In 2006, the
amount needed to service government’s debt (P784.5
billion) is almost equal to the tax collected (P785.2
billion, January to November). Debt service ballooned
from an average of 19.5 percent of overall government
spending in the time of Estrada to 26.8 percent under
Mrs. Arroyo.
In the
2007 budget alone, P622 billiion was earmarked for debt
service (interest and principal) while education and
health received merely P146 billion and P13 billion,
respectively.
The FDC
also assailed the administration’s policies
of regressive taxation—failing “to tax the rich due to
massive tax evasion of corporations, Mrs. Arroyo instead
opted for consumption taxes [E-VAT, R-VAT] practically
targeting the common man’s income.”
It said
privatization of state assets is a palliative for poor
revenue collection.
It said
that contrary to official data, investment record was
poor. The liberalization policies did not trigger a
healthy flow of foreign direct investments, because “our
country actually has the worst investment record among
Asian countries.” (With C. Jimenez, C. Mocon) |
