In the second decade of the 21st Century, Filipinos can look to the future with confidence and with much to be proud of.

Mexican slugger Juan Manuel Marquez who sent him to slumberland for at least two minutes with a devastating right to the jaw a second before the end of the sixth round.

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 who has become middle class.

That middle class is growing by 9 percent per year.

In the last eleven 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.

PH world’s 12th largest market
The Philippines is the world’s12th 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 $315 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.

PH is world’s 34th richest with $315B GDP
The $315 billion GDP makes the Philippines the 34th richest country in the world today, right behind Venezuela and ahead of 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 GDP purchasing power parity 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 refers to fossil fuels, minerals, forest resources, agricultural land and fisheries.

The Philippines has plenty of human capital, 100 million, 20 times that of Singapore which is dwindling. The Filipino’s average literacy is 95 percent, one of the highest in the world. He speaks English, the language of trade and the Internet. He 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.

$23 trillion a year in remittances
Of the Philippines’ 100 million human capital, ten million are deployed abroad. These expatriates remit $23 billion a year more than four times the $5 billion net foreign investments that flowed to the Philippines in 2011.

In 2012, remittances should reach $23 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 is 5 percent in 2011.

The World Bank projects global remittances to grow 7 percent to 8 percent per year until 2014.

Huge potential of remittances
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.

As of end-October 2012, the Philippines had net international reserves of $82 billion, more than enough to buy 12 months’ worth of imports. An ideal reserve buffer is only three months’ worth of imports.

 P2.95 trillion in savings
Filipinos have a savings rate of 29.5 percent. If the country’s GDP is P10 trillion, 29.5 percent translates into P2.95 trillion, enough to cover the national budget 1.6 times over.

The Philippine commercial banking system has total deposits of P5.04 trillion half the size of the GDP.
 
P1.47 trillion in idle bank deposits
Of the P5 trillion, only P3.57 trillion has been lent out, leaving P1.47 trillion deposits which are idle (most of it parked in safe securities issued by the Bangko Sentral). Imagine what P1.5 trillion could do to our lives and to our economy if that were released to the economy?

The P1.47 trillion is enough to fill the pockets of 25 million Filipinos (the number of the poor) with P58,000 each and suddenly they will be middle class, with $3.92 in per capita income per day—double the poverty threshold.

The world has made an industry of perennially underestimating the Philippines. Its economy is supposed to be uncompetitive, ranked No. 65 in 2012, though an improvement from 175th the previous year.

The country is supposed to be corrupt, ranked in the bottom third in transparency index where the lower you are, the more corrupt you are.

The Philippine credit rating is not investment grade. With $82 billion in reserves, the country can pay its $62 billion foreign debts overnight – with still $20 billion to spare. The United States, which is triple A credit, cannot pay its debts. It cannot even pay its medicare bills, its pension obligations.

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