The credibility of the Philippines

Mike Wootton

Mike Wootton

A couple of weeks or so ago, my column was entitled Out of Control Corruption. This week’s column is on the same topic but from a different angle, namely the damage caused by out of control corruption to the credibility of the Philippines; its economy, the future of the country and the lives and opportunity for ordinary Filipinos.

It strikes me that this business about the Priority Development Assistance Fund (PDAF) money, even the smuggling losses, and all the other less dramatic corruption that goes on has been known about by some people for a long time, the pork barrel rape has been going on for years according to the Commission on Audit. Only now have these “skeletons” started to get out into the public arena, thanks to a media which has become inquisitive due to the economic revelations of the massive gulf between different sections of society which in turn were highlighted by the trumpeting about stellar economic progress. People couldn’t understand that if indeed there was such stellar economic progress, why were the lives of most of them actually becoming more difficult, what about the economic fundamentals, like living costs, jobs and salary levels?

It has been suggested elsewhere that the international rating agencies such as Fitch, and Standard and Poor’s could in fact be lobbied to upgrade sovereign ratings, and that this is the reason that the Philippines suddenly achieved an investment grade of “BBB-“. Looking back to the Fitch report of March 27 this year: “Fitch Ratings’ upgrade of the Philippines reflects persistent strengthening of external finances, a strong policy-making framework, improvements in fiscal management leading to a sustained decline in public debt ratios, and enhanced growth prospects.” “Strong policy making framework”?, “improvements in fiscal management”?

In the light of recent exposures, the above report would seem to be to say the least a bit superficial if not just downright misleading. Unfortunately, it seems to me that foreign investor interest in the Philippines has been piqued by all the trumpeting about sound economic policies and the like, and even now the National Economic and Development Authority is forecasting continuing robust economic growth!! There has been quite a recent upsurge in people from abroad trying to sell equipment and expressing interest in learning more about investment opportunities here. When they come to have a look, what will they find, they will pick up any newspaper and see it full of stories of scams—P10 billion, $30 billion, $900 million etc, etc. and they will realize that their journey was probably wasted [although it will have put a bit of money into the economy by way of travel and accommodation costs !!].

The media hype about economic performance, and the questionable credit rating upgrades, while all the time there was so much filth hidden under the carpet, is not a shot in the foot, it may well be a shot in the heart for future foreign direct investment, other than perhaps by investors who just regard what goes on here as business as usual. But even some of them might give pause for thought for the laws of their own developed economies [United States and Europe in particular] that inhibit their participation in corruption wherever that may be, as well as the ever expanding invincibility of the local big businessmen.

Not only have there apparently been some very big bits of corruption and dishonesty going on for a long time, but their scale has recently increased dramatically – smuggling up from $3.8 billion to $19.6 billion in the last three years, PDAF monies [not all stolen !]up from an average P7.8 billion a year to an average of P24.8 billion a year in the last three years. And how did the local oligarchs make personal wealth equal to about 25 percent of the nations annual gross domestic product or GDP, in the first place?? Was it just intellect and clever business dealing, or were there other factors involved? What would a knowledgeable outside observer think??

Having said it before, I will say it once again . . . the problem here is that nobody really does much about corruption, everybody knows it goes on, after all it is the euphemistically named “Philippines way of doing business” but it is the nature of the Filipino to just shrug and ignore it, “that’s the way it is,” don’t people realize that it takes the money from the social security system, the medical services, road, travel and other infrastructural items, it costs lives so why not do something!!

What is happening now, thank goodness, and at last, looks a bit different, the topic is up for public debate, problem is that the scale is so huge and its tentacles so all pervading that national credibility suffers and prospective investors in such a Slough of Despond as described by John Bunyan in Pilgrim’s Progress: “This miry Slough is such a place as cannot be mended; it is the descent whither the scum and filth that attends conviction for sin doth continually run, and therefore is it called the Slough of Despond: for still as the sinner is awakened about his lost condition, there ariseth in his soul many fears, and doubts, and discouraging apprehensions, which all of them get together, and settle in this place; and this is the reason of the badness of this ground,” driven up by media hype earlier in the year now just shrug and go somewhere else where things are better controlled, foreign direct investment is welcomed for whatever reason, laws are followed objectively and business is easier and quicker to do, and more predictable.

There are of course beneficiaries to all this, local big business has managed to ensure by default that no outsiders will impinge on their markets . . . nd they can just carry on with the usual Philippines way of doing business !

Cynicism aside, there is a situation at the moment in which the citizenry is rightfully angry. Notices are being circulated on the Internet to gather a 1-million strong demonstration to protest the disappearance of the PDAF money. The people cannot trust their elected representatives who are governing their country, so what can they do but demonstrate themselves and no doubt hope that somehow somebody will do something to straighten out this so called democracy and economic powerhouse.

It really is so sad that a nation which has the skills and potential to really be at least an economic tiger cub should allow its people to struggle against so much adversity, and force so many of them to have no option but to live in squalor purely to satisfy the selfish greed of a few. To fail to take some strong action to rectify matters would be a terrible crime against the people.

Mike can be contacted at


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  1. We need Anti Corrupt Czar that’s more powerful than President if there’s investigation pertaining to corrupt practices and accountability is concern. His works is solely concentrated on running after corrupt officials even the President if he do illegal. The one appointed must be Independent like Supreme Court Cheif.

  2. juan dela cruz on

    Very good column. These Pinoy politicians are so GREEDY and PNOY should teach them a lesson. HANDCUFF them and show them on CNN so thw world will know them.
    Rot them all in JAIL. PNOY- ACTION not too much TALKING.

  3. Ernesto Santos on

    No wonder God sends disasters and calamities one after another to this country who claimed to be the only (Christian?) or Catholic country in Asia. And these government officials seems to be very very religious, attending mass regularly, making fool of themselves.

  4. Your column is right on point for Country credility or first impression and perceptions:

    Improved ability to perceive leads to better understanding, comprehension, attitude and then ablity to act effectively or coherently. And collectively for that matter from matching governance and governed in sync. One hand knows what the other hand is doing.

    Your column is Instantly WorldCast on under Media Match Portal Category of MissionTours.

    Rober F. Posadas, JD, Philets61, UST, Manila, Founder: Unified Media Match WorldCast, US Patented Method 2012, San Diego,Ca., USA

  5. You complain that nobody is doing anything to stop corruption. Who do you expect to stop it? The corrupted politicians? The “representatives” bought the votes they needed to win office. You think they spent P500/vote because they really really really wanted to serve the public? No. The P500/vote was an investment. And now they’re reaping the dividends.

    Do you expect the citizens to do something? What can we do? You write about it and I read about it. We agree that it’s wrong. But what can we do? We don’t have any power. This country doesn’t acknowledge petitions and referendums. What do you suggest we do? Assemble and protest? What will that do?

    There is only one real solution to this problem. Abolish congress and enact direct democracy. In the mean time, let us hope that the DoJ and NBI are zealous in their duties.