Whoever succeeds President Benigno Aquino 3rd later this year must focus on domestic and external threats that could challenge the Philippine economy if growth is to be sustained, an economist said.
“A higher growth path is what we are seeing for the Philippines,” said Alvin Ang, professor at the Ateneo de Manila’s Department of Economics, said in a lecture on Tuesday.
Ang pointed out that over Aquino’s six-year term—set to end in the middle of this year—the Philippines saw average gross domestic product (GDP) growth of 6.3 percent.
To sustain this, he said the country’ next chief executive and his administration should be ready to deal with challenges brought by external developments, weather, connectivity, and poverty.
“The next government must know how to deal with the current swing in the global markets . . . Many of those in the markets right now have not experienced a bear market,” Ang noted.
With regard to climate change, he said the next government must be prepared for the fallout from the threat of El Nino, which severely affected agriculture last year as is expected to worsen in 2015.
“Definitely, there will be a hit . . . but it’s not going to be [in]agriculture alone. There would be shortages in water, it would affect power, so it could connect to the industries as well. So what are we doing about it?,” Ang said.
Another issue that needs to be addressed, he said, is Metro Manila’s monstrous traffic.
“We are losing a lot because of the heavy traffic. The next administration must not give it to the local government to solve, it has to be a national concern,” he said.
In the medium term, Ang urged that growth should benefit the poor.
To achieve this, he said the next government should continue to invest in social protection like insurance and a conditional cash transfer program that is understandable, clear, and imbued with focus and purpose.
Ang also recommended that the next administration review the charters of the Social Security System and the Government Service Insurance System to avoid the funding problems that these state-supported pension systems are facing.
“This is critical because the Philippines will age as well. We are not going to be young for the rest of our lives . . . We have to prepare and invest in social protection,” he concluded.