For those of you distraught by Dan Brown Inferno’s depiction of Manila as the gates of Hell, listen to architect Jun Palafox. He says the Philippine is great for the following reasons:
* No. 1 in marine biodiversity
* No. 1 in number of seafarers
* No. 1 in voice call centers
* No. 1 in musicians (all the cruise ships have Filipino musicians)
* No. 2 in gold reserves
* No. 5 in all other metallic minerals
* No. 2 in length of coastline
* No. 4 in shipbuilding
* No. 12 in human resources. Expatriate Filipinos are the most-preferred employees abroad.
Indeed, as I keep repeating in my articles, Filipinos have much to be proud of.
During most of the 21st Century, Filipinos can look to the future with confidence and with much to be proud of. That is inspite of the Philippines having BS Aquino III for its President.
We are talking here not just of Manny Pacquiao, who has won his congressional reelection (he ran unopposed) after losing three consecutive times to three strong challengers.
We are talking here not just of Puerto Princesa’s famed underground river, which has just been proclaimed one of the Seven New Wonders of Nature.
We are talking here of wealth—the unusual wealth of the Filipino.
Today, the Filipino is veritably a middle class—upper middle class. That middle class is growing by 9 percent per year.
In the last 11 years, per capita Filipino income, at current prices, has almost tripled, growing by 2.76 times, from $1,146 in 2001 to $3,157 by 2011. In percentage terms, that’s an average yearly growth of 16 percent. If you extrapolate this growth rate over the next five years, by 2017, per capita income will reach $5,682.
The present per capita income of $3,157 is equivalent to an income of $8.65 a day. The World Bank considers you poor if you make $2 or less a day. The World Bank thinks the Philippine per capita income is more than $4,300 actually, that is, in terms of what the money can buy in local products. That makes us No. 134 in world in income. But that understates the country’s wealth and potential size
The Philippines is the world’s 12th largest country in terms of population, behind Mexico, which has 112 million, and ahead of Vietnam, which has 88 million.
Being No. 12 in population, the Philippines is also the 12th largest consumer market in the world. Multiply 100 million by the $3,157 income per capita and you get a $316-billion market.
That market grows by 2 percent a year in number and 16 percent a year in value. So the total gain is 18 percent.
The $316-billion GDP makes the Philippines the 34th richest country in the world today, right behind Venezuela and ahead of floundering Greece.
In nominal GDP, we are richer than Malaysia ($278.6 billion), Finland ($266 billion), Chile ($248.58 billion), Hong Kong ($243.66 billion) and surprise, even Singapore ($239.7 billion) and Portugal ($237.52 billion).
In size of GDP in purchasing power parity terms, or taking into account relative costs of living, the Philippines ranks No. 31, with $392.6 billion. We lose out to Malaysia ($449.87 billion), but we edge out Sweden $391 billion, UAE $380.5 billion, Switzerland $378 billion, Venezuela $375.8 billion, Austria $354.6 billion, and again, Hong Kong, $353.5 billion and Singapore, $316.74 billion.
Being No. 31 or even No. 34 in wealth is nothing to sneeze at. After all, there are 204 countries in the world and we are in the top 15 percent.
The reason for the wealth or the huge size of our economy is the size of our population and the richness of our natural resources.
New measures of wealth
The UN’s Inclusive Wealth Index (IWI) measures the wealth of nations by looking into a country’s capital assets, including manufactured, human and natural capital. Manufactured capital includes machinery and buildings, while human capital examines education and health, and natural capital incorporates factors such as fossil fuels, minerals, forest resources, agricultural land and fisheries. Ecosystem services and water accounting were not included due to lack of reliable data.
The Philippines has plenty of human capital, 100 million, 20 times that of Singapore, which is dwindling. The Philippines’ average literacy is 95 percent, one of the highest in the world.
It speaks English, the language of trade and the Internet. It is skilled and easily trainable.
Outside of the devastation of its forests, the Philippines remains rich in natural resources—minerals, rare metals, natural gas, probably oil. Two-thirds of its territory is water—a rare commodity in this century.
We have plenty of land. In Laguna Lake alone, you can sink the entire Singapore and still have 24,000 hectares to spare.
Of the Philippines’ 100 million human capital, 10 million are deployed abroad. These expatriates remit $24 billion a year, more than ten times the average $2 billion in investments that come to the country in a good year.
In 2012, remittances exceeded $24 billion. The global remittance volume in 2012 was $372 billion, up by 12 percent from 2010. This 12 percent growth is more than double the growth in total world trade, which was a paltry 5 percent in 2011.
The World Bank projects global remittances to grow 7 to 8 percent per year until 2014.
The potential of remittances is huge. The Philippines accounts for only $21 billion or 5.6 percent of the $372-billion global remittances.
As a business, the $372-billion global remittance figure is bigger than illegal drugs, which was estimated at $321 billion in 2007 and the global arms trade, which was estimated at $50 billion, also in 2007. Only the $3-trillion oil business and global tourism’s $1.2 trillion, are bigger, and by a mile.
The Philippines had net international reserves of over $85 billion, more than enough to pay for 12 months’ worth of imports. An ideal reserve buffer is only three months’ worth of imports. So why is the country keeping so much dollar stash?
Filipinos have a savings rate of 29.5 percent. If the country’s GDP is P12 trillion, 29.5 percent translates into P3.5 trillion, enough to cover the national budget six times over.