The otherwise relatively strong performance of the economy would have been more stable and convincing, if it were not for the sporadic commission by some “high-profile” personalities of graft and corrupt practices in the bureaucracy. The wide spectrum of people and network, who are engrossed in such kind of malpractice that is meant to override the respectable achievements of this administration, is something noteworthy, for it has put some people in the “limelight” of shame and embarrassment. But regardless of the barrage of accusations and pointing of an accusing finger at one another, the stigma of high profile sleaze remains, but with no one to take the blame for such kind of malfeasance. This is how these episodes end, and because of strong political connections from the powers that be, the poor “Juan de la Cruz” is pushed deep down further to the quagmire of poverty.
The amount of money lost from graft and corruption is something significant enough to address more than what the statistics for poverty needs. In his article on the “Thesis on Corruption,” Prof. Randy David implied that this societal menace is very well pronounced in our society and system, that corruption is deeply embedded and institutionalized in all public sector “services.” In every corner of the bureaucracy, this seems to be a permanent fixture that is necessitated in its operation. This “diversion” of funds from public to personal funds provides opportunities for hunger incidence to set in. Rather than putting the much-needed public funds to more productive endeavors, it is diverted into personal objectives purportedly for enrichment that unnecessarily disadvantages the less-privileged.
The government, being the biggest individual spender of the economy, puts a lot of pressure on alleviating the plight of poor sector in our society. Money lost from the government coffers because of these guile acts is dysfunctional for government efficiency. Implicitly, investment becomes scarce, because it unnecessarily discriminates savings since money “earned” from graft and corruption is income lost for the economy.
Foreign currency reserves
Based on latest reports, Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco Jr. said that the country’s gross international reserves (GIR) rose 2 percent to $82.9 billion in July from $81.2 billion in June. This was achieved after a lackluster performance since early this year. The central bank governor added, “The increase was due to BSP’s foreign exchange operations and some revaluation gains at least for last month.” This of course comes from the proceeds of foreign transactions (net exports), which likewise include the net factor income from abroad. These include the income of the Filipinos and Filipino interests abroad that are remitted to our country. But more importantly, the bulk of the growth in our gross national product is the revaluation of our foreign currency holdings. It therefore represents the increase in the value of currency as a result of the changing economic and business environment. Therefore, the country despite not significantly moving economically, has gained from “reappreciation.”
It is both positively and negatively perceived considering it may have been a “consolation prize” for the country’s mediocre performance, considering that the country’s GIR increased by a measly 2 percent to $82.9 billion in July from $81.2 billion in June. This measly increase in foreign currency income reflects our performance (or nonperformance) in the field of international trading. This is one area where we should try to improve on, considering our intense drive toward achieving the tiger status at the soonest time. Added this to the fact that is foreseeable onset of full globalization in the next few years.
Bonifacio Global City
The current tug-of-war between Makati City and Taguig City on the jurisdiction of Bonifacio Global City (BGC) will unduly affect the conduct of business operations along that stretch of the area. It is to be noted that the major intention of the businesses that reside in BGC is the tax reprieve (reduced rate) that accompanies being in the territorial limits of Taguig City. Although not yet final and executory, the possibility of it being turned over to Makati City could unnecessarily bring confusion, especially to those who will be negatively affected (because tax is a big component of production cost) by the transfer of jurisdiction. Not to be overlooked likewise, is the claim of Pateros on BGC. Despite lacking in legal basis because they bank on historical tradition (like China), Pateros’ legal claim on this disputed territory further adds spice to the looming controversy about the prime commercial area.
The sooner this issue can be settled, the better it will be for the business sector so everybody can buckle down to work.
Stocks lackluster state
The current lackluster performance of the bourse was primarily an offshoot of psychological factor and not necessarily because of a macroeconomic phenomenon. Buoyed by the Chinese belief that August is a ghost month, the predominant Chinese players would prefer to hold on to their horses until such time that the “ghost” has passed. But with significant economic fundamentals that will significantly move the market, this ghost may have to disappear sooner than expected.
The foreign stock market’s mediocre performance likewise has complemented the lackluster accomplishment of the local bourse, giving rise to the adrift nature of the Philippine equities market which should be short-lived and reactivated sooner.
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