As the next president is inaugurated and the new administration is ushered in, research group IBON said that new policies are desperately needed to fix old economic problems that worsened under the Duterte administration. The group said that the Duterte government’s conventional market-oriented policies, even during the pandemic, have left the Philippine economy in shambles. IBON warned that unreformed policies under the new administration will keep the country on the same path of economic decline.
IBON said that despite the Duterte administration’s constant hype of its achievements, its adherence to narrow-minded big business-friendly policies amid neglect of social development leaves the next administration and millions of Filipinos with a load of urgent socioeconomic issues.
The country’s economy and job generation were slowing even before the pandemic while recent rapid growth is unsustainable. Agriculture shrank to its smallest share of the economy in the country’s history. Manufacturing is down to its smallest in 70 years while becoming even more shallow and foreign-dominated.
Meanwhile, the latest labor force figures show joblessness and poor-quality work worsening. Employment levels have actually fallen aside from becoming increasingly informal, part-time and self-employed work. The number of poor Filipinos and of households without savings is growing which means more and more Filipinos still struggling to recover from the government’s excessive lockdowns.
Incoming president Ferdinand Marcos Jr has not been very specific about his plans for the economy. Still, it is already clear that his administration will continue with the Duterte legacy and failed neoliberal policies instead of reforming these, said IBON.
IBON pointed out that Marcos Jr is not showing any original ideas for the country’s most urgent economic issues. For instance, he parrots the refusal of the outgoing economic managers to suspend fuel excise taxes despite the popular clamor for this amid soaring prices of oil and other goods and services. This may also indicate agreement with the outgoing administration’s so-called fiscal consolidation and resource mobilization plan of new taxes and lifting value-added tax (VAT) exemptions on consumption goods to the detriment of the public.
Marcos’s choice of economic managers is also telling of the pro-market and big business-biased policies his administration intends to pursue. For instance, outgoing central bank governor and incoming finance secretary Ben Diokno who will head Marcos’s economic team was among those who pushed for introducing the VAT while budget secretary under Corazon Aquino. He and the rest of the managers have expressed the same unoriginal priorities as the outgoing managers: infrastructure, creditworthiness, and foreign investments.
IBON said that the Marcos government’s real priorities will be seen by how it handles urgent issues plaguing the country – a slowing economy, worsening joblessness, informality and poverty, and low wages and incomes amid soaring prices for oil and basic goods and services, among others.
Instead of following the obsolete “free market” globalization footsteps of the outgoing government, this next administration should adopt economic development policies of effective state intervention and protection to really help the economy and Filipino people recover and flourish, said the group.