How Much More Can The Philippine Economy Endure From Rodrigo Duterte?-FORBES


Firearms feature a lot when it comes to Rodrigo Duterte. Their role in the cult of personality dynamic that propelled him to the presidency is perhaps best demonstrated by a 2015 Esquire Philippines magazine cover.

It featured the tough-guy mayor of the southern Davao City wearing a flak jacket, cradling an assault rifle and backed by a mob of men seemingly loaded for bear.

The inference was clear. This strongman, one part Che Guevara, one part Rambo, was ready to storm the economic establishment. And 15 months later, Duterte did just that as voters put the unlikeliest of mavericks into the presidential palace.


Since then, the Duterte era has waged a war against drugs that went beyond just targeting the dealers and users. He’s made threats against anyone who gets in his way from human-rights activists to corrupt cops to “rich people.” But little did supporters suspect that the real thing Duterte would end up shooting is the economy.

Granted, Duterte dreams of inflicting harm by other means, too. He talks of dropping corrupt officials from helicopters and a desire to get rid of “useless bishops.” Yet this rhetoric distracts from the real costs that three and half years of Duterte is doing to what was one of Asia’s most impressive economies when he took power.


Duterte often gets a pass on economic missteps because of good top-line numbers. In this way, he’s not unlike Donald Trump. In 2017, the U.S. president inherited a multi-year expansion from Obama and spun it as his own. That momentum papers over Trump’s moves to enrich the upper class, upend the rule of law and savage the environment.

The 5.9% growth the Philippines clocked in 2019 helps Duterte deflect from his own economic blunders. Here are three worth exploring.

One: Manila’s sliding corruption ranking. Berlin-based Transparency International might now be in Duterte’s crosshairs, too, as it downgrades his policies toward graft. Between 2018 and 2019, Manila’s standing in the group’s corruption perceptions index tumbled 14 notches. That equates to nearly 1.7 points of lost ground for every month over the last 12. All told, the Philippines lost 18 rungs on Duterte’s watch, putting it on par with Kazakhstan and Zambia.

It’s doubtful even the most passionate Duterte fan expected this relapse. Duterte’s folk-hero status rested on his nearly three decades running Davao City. His iron-fist leadership was reputed to have generated cleaner governance and greater efficiency than the national average.

Voters tapped Duterte to replace Benigno Aquino and build on the outgoing president’s successes. When Aquino took power in 2010, Manila’s corruption ranking was in behind Nigeria‘s. He worked steadily to increase transparency at ministries, put many governments services online to cut out middlemen and went after tax cheats. In short order, the Philippines won its first-ever investment-grade ratings.

Another the explanations: as Duterte merely took on one group of dynastic families concentrating power and wealth to empower a new one. Either way, the backsliding on corruption is turning off foreign investors who rediscovered the Philippines over the last decade.

Two: a botched infrastructure push. Duterte hit the ground running with a $180 billion “Build, Build, Build” campaign to raise competitiveness. And indeed, better roads, bridges, ports and power grids are urgently needed if the Philippines is going to win business from Apple, Samsung, Toyota and other multinational giants. Aquino’s process, he complained, was too slow and dogged by regulatory speed bumps.

Yet Duterte’s haste to green light giant projects removed many of the good-governance and sustainability safeguards. His financing model sidelined Aquino’s public-private partnership strategy. Duterte favors government-led deals. The upshot, critics worry, is the return of the graft and excessive debt of the past.


Oddly, though, even Dutertenomics is getting bogged down in bureaucracy, poor planning and a level of incompetence that seems a far cry from his get-things-done reputation. That helps explain why the economy in 2019 grew at the slowest pace in eight years.

Again, a nearly 6% pace is nothing to sniff at amid a global trade war. It means, though, that the we’re-growing-faster-than-China buzz of the Aquino years is giving way to stark sobriety.

The Philippines, though, doesn’t just need to grow faster. It needs to grow better to spread the benefits of expanding gross domestic product to tens of millions of families struggling to move from low-income to middle-income status. That means creating enough good-paying jobs so that more than 10% of Filipinos don’t have to work aboard and remit cash home.


Three: a disturbing media assault. This is another Trumpian parallel, but one Duterte is taking further by trying to shut down ABS-CBN. The media giant, which Duterte deems a foe, could see its 25-year-old franchise ended.

The last time Duterte’s anti-press campaign made global headlines was 12 months ago. That’s when Manila arrested award-winning journalist Maria Ressa, a former CNN correspondent running the Rappler online news portal. The Philippine Daily Inquirer, which Duterte views as too critical, has had its own run-ins with a president who loathes dissent.


Isn’t that the problem, though? Any leader who’s genuinely determined to root out graft should see investigative journalists as allies. These scribes can help police corrupt politicians and businesspeople, uncover impropriety in public bidding processes and inefficiencies that squander government resources.

A free and vibrant media could help Manila get anti-corruption efforts back on track and clean up Duterte’s “Build, Build, Build” extravaganza. The Philippines, though, is 134th. Not a placement conducive with the orderly, efficient and competitive economy many voters hoped Duterte would craft. Instead, he’s shooting in the foot an economy that just four years ago was beginning to stand high.


Source: https://www.forbes.com/sites/williampesek/2020/02/21/how-much-more-can-the-philippine-economy-endure-from-rodrigo-duterte/?fbclid=IwAR2ow6J-dwXqOvifYp4m9LRsl97-jv1LFAY6UWn9JTM9v7-69K4iSVIaxj8#54ded7231b1c

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