WITH the full-scale media blitz to highlight purported accomplishments of President Benigno Aquino 3rd’s administration, a good number of Filipinos and foreign observers are fretting that after he steps down, the country would go south—that is, go bad, not just go toward Davao, the bailiwick of Aquino’s successor.
In fact, things should improve in crucial areas, especially in fighting crime and drugs, improving security and foreign relations, boosting growth, and enhancing business prospects. Even in Aquino’s avowed priority thrusts of reducing poverty and graft, new President Rodrigo Duterte should outdo him.
Crime can be cut in half
Under Aquino, crime incidents tripled, from 324,082 incidents in 2010 to more than 1 million a year since 2013, based on data from the Philippine Statistics Authority <https://psa.gov.ph/content/philippines-figures-0> (2011 – 12 statistics are faulty, for which police chiefs were investigated and suspended in 2013).
Crimes against persons hit 258,444 in 2014—triple the 2010 number, while crimes against property jumped 94 percent, from 118,943 to 231,005. Physical injury, rape and theft more than doubled.
And all types of index crimes reached their highest levels since 2009, when the Philippine National Police adopted its Unit Crime Periodic Report system, recording tens of thousands of crimes undetected in previous years.
Indeed, Duterte’s landslide victory is in large part due to the 3 million-plus crimes recorded in the past three years—and countless more unreported—with more than 30 million Filipinos who are victims or their close family and friends.
With dozens of drug lords killed or arrested after Duterte’s election, crime should fall from its record levels. After half a million crimes were counted in the 2009 reporting system, the Philippine National Police brought the incidence down by 35 percent in one year, even without today’s massive crackdown. Duterte can cut it even more.
Growth and infrastructure will surge
The new administration’s 10-point agenda, outlined at a June 20 Davao City meeting with business leaders, include several priority thrusts likely to boost growth and business prospects to match if not exceed Aquino-era gains:
• Higher infrastructure spending, with 5 percent of gross domestic product targeted
• Lower income and corporate tax rates to better compete with other Asian nations
• Less red tape and corruption, including permits and land titles crucial to business
• More state resources for the countryside, reducing poverty and boosting rural growth
• Strong law enforcement and peace efforts to enhance the business environment
• Small business gains with GoNegosyo’s Ramon Lopez as Trade & Industry Secretary
• Better China relations enhancing Chinese trade, tourism and investment flows
With infrastructure outlays up—P1 trillion next year, double the 2016 outlay, says returning Budget Secretary Benjamin Diokno—and consumers and companies keeping more of their earnings to spend through lower tax rates, all three GDP components of consumption, investment and government expenditures should expand.
That would end the chronic underspending perennially hobbling the economy under Aquino. In 2011, his first full year in office, public works expenditures fell by half for the first time, also halving GDP growth. In most of the succeeding years, state expenditures contributed less than 1 percentage point to annual economic expansion, despite constantly rising budgets.
Furthermore, reducing red tape and corruption, channeling more resources to the countryside, and enhancing the business climate through law and order would expand opportunities in entrepreneurship and less developed regions. Add to that the boost from more capital and tourists from China and exports to the world’s No. 2 market.
‘KKK’ corruption will diminish
Duterte’s hard line against corruption even by his own family—with threats to kill children dealing in drugs—augurs well for keeping his official family clean and ending Aquino’s cronyism, labeled KKK for the Filipino initials of his clique of classmates, allies, and shooting buddies.
Duterte rightly told his Cabinet that he and his family will not interfere in agency appointments, but the heads would be responsible for failings and sleaze by underlings. Similarly, in the presidency of Gloria Arroyo, three Cabinet Secretaries—Hernando Perez of Justice, Arthur Yap of Agriculture, and Angelo Reyes of Defense—quit over allegations of impropriety, with Arroyo instantly accepting their resignations.
That contrasts with Aquino’s constant defense of all his appointees, with no sanctions and not even a word of criticism, even over the mammoth sleaze that burdens millions of Metro Rail Transit commuters daily, terrorized travelers with laglag-bala at Manila airport under his uncle, and smuggling tripled to $26.6 billion in 2014.
If Duterte cracks the Cabinet whip, then officialdom would stay in line.
Poverty will fall
The bicggest reduction in official poverty incidence since 2000 happened between that year and 2003. Families living below the poverty line declined by nearly 3 percentage points to less than a quarter of all households.
Key to that achievement was boosting state funds going to the countryside. Upon taking over, then-President Arroyo released billions of pesos in internal revenue allotments to local government units nationwide, which were held up by past administrations.
Then she realigned funds to channel more than P20 billion a year to farmers and fisherfolk under the Agriculture and Fisheries Modernization Act she had authored as senator, but which was never implemented.
Third, she accelerated the distribution of public and private lands to landless farmers, indigenous communities, and urban informal settlers. That increased the assets of the poor, who can then use them to raise their income or cut their housing costs.
Duterte aims to lift 9 million Filipinos out of poverty—1.5 million poor people every year till his term ends in 2022. That’s 1.25 – 1.5 percentage points drop annually, estimates new Finance Secretary and Mindanao tycoon Carlos Dominguez.
His Economic Planning Secretary, Ernesto Pernia, a long-time poverty expert at the Asian Development Bank and the University of the Philippines, sees more resources for the regions as key to winning against destitution.
“We need to rebalance the economy from [Metro Manila] development to regional and rural development, to achieve poverty- and inequality-reducing growth,” Pernia told business leaders.
Under Aquino, crime and smuggling tripled, KKK flourished, and poverty was stuck above 25 percent despite strong economic growth.
Duterte will do better.