The way of Aquinomics in the Philippines

Reading Time: 2 minutes
Benigno
Philippine President Benigno Aquino III

Along the halls of Malacañang Palace, office of Philippine President Benigno Aquino III, a zesty fiesta-like atmosphere still lingers following the country’s first-ever investment credit upgrade by Fitch in March.

Stepping past the $2.2-billion goal post his administration has set for FDI in 2013 will be a test of just how the jubilant government can focus their attention on turning the hitherto laggard Southeast Asian nation’s image of a den of corruption on its head. Someone is bound to feel the heat.

The investment rating upgrade shows the strong confidence of other countries in the Philippines, President Aquino recently told local media, adding that it will now be easier to obtain loans at lower interest rates and thus maximise public spending.

Leaving the starchy economic prose behind – Aquino’s administration now has drawn the spotlight on itself and has to perform under pressure, while the world and its citizens watch just how the scion’s government steers this monumental opportunity.

Attracting investors to the Philippines has traditionally been like walking a tight rope – the slightest negative breeze sending the effort toppling.

Among foreigners’ top worries in the Southeast Asian archipelago is the lack of a fair judiciary system, which is defined by venality and often favours entrenched business leaders. Outside of Manila, expatriates, Philippine watchers and those most informed with the reality of the country note that a feudalistic society reigns suppress in lieu of strong governmental influence.

Further frightening prospective entrants is the country’s “wild, wild East” image; no one can confidently form trust in a society that still feels the need to placed guards armed with shotguns and automatic weapons in front of any establishment where money flows in regular spurts, including seemingly innocuous businesses like Jollibee and 7-Eleven.

Aquinomics has endeavoured to remedy this: while boosting government spending and cutting fiscal deficit, Aquino’s administration has whipsawed at stunted economic growth and widespread corruption, restoring faith in the country as evidenced by Fitch’s much-coveted accolade.

The ebbing away at the Philippines’ corruption image will produce manifold results: Once foreigners find that their investments won’t be susceptible to crooked policies – especially through safeguards provided by the Asian Development Bank – they will come en masse as portended by the branding of major credit rating agencies, now expected to follow Fitch – or so its hoped.

Additionally,  the Philippines’ new shine will create much needed jobs through the foreign investment inflows that amounted to paltry amounts in the past. Already Canada’s recent $7.1 million grant in the tourism industry to groom 5,000 skilled workers can prove a potent precedent to gaining this momentum.

Yet this is just a drop in the bucket to what is needed to fill the job demand.

For Aquinomics, the de facto ideology of current-day Philippines, to attract more foreign fans, jobs will need to start coming online from what has already been seen, proving that “inclusive growth” is more than just a tag line.

 

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Reading Time: 2 minutes

Philippine President Benigno Aquino III

Along the halls of Malacañang Palace, office of Philippine President Benigno Aquino III, a zesty fiesta-like atmosphere still lingers following the country’s first-ever investment credit upgrade by Fitch in March.

Reading Time: 2 minutes

Benigno
Philippine President Benigno Aquino III

Along the halls of Malacañang Palace, office of Philippine President Benigno Aquino III, a zesty fiesta-like atmosphere still lingers following the country’s first-ever investment credit upgrade by Fitch in March.

Stepping past the $2.2-billion goal post his administration has set for FDI in 2013 will be a test of just how the jubilant government can focus their attention on turning the hitherto laggard Southeast Asian nation’s image of a den of corruption on its head. Someone is bound to feel the heat.

The investment rating upgrade shows the strong confidence of other countries in the Philippines, President Aquino recently told local media, adding that it will now be easier to obtain loans at lower interest rates and thus maximise public spending.

Leaving the starchy economic prose behind – Aquino’s administration now has drawn the spotlight on itself and has to perform under pressure, while the world and its citizens watch just how the scion’s government steers this monumental opportunity.

Attracting investors to the Philippines has traditionally been like walking a tight rope – the slightest negative breeze sending the effort toppling.

Among foreigners’ top worries in the Southeast Asian archipelago is the lack of a fair judiciary system, which is defined by venality and often favours entrenched business leaders. Outside of Manila, expatriates, Philippine watchers and those most informed with the reality of the country note that a feudalistic society reigns suppress in lieu of strong governmental influence.

Further frightening prospective entrants is the country’s “wild, wild East” image; no one can confidently form trust in a society that still feels the need to placed guards armed with shotguns and automatic weapons in front of any establishment where money flows in regular spurts, including seemingly innocuous businesses like Jollibee and 7-Eleven.

Aquinomics has endeavoured to remedy this: while boosting government spending and cutting fiscal deficit, Aquino’s administration has whipsawed at stunted economic growth and widespread corruption, restoring faith in the country as evidenced by Fitch’s much-coveted accolade.

The ebbing away at the Philippines’ corruption image will produce manifold results: Once foreigners find that their investments won’t be susceptible to crooked policies – especially through safeguards provided by the Asian Development Bank – they will come en masse as portended by the branding of major credit rating agencies, now expected to follow Fitch – or so its hoped.

Additionally,  the Philippines’ new shine will create much needed jobs through the foreign investment inflows that amounted to paltry amounts in the past. Already Canada’s recent $7.1 million grant in the tourism industry to groom 5,000 skilled workers can prove a potent precedent to gaining this momentum.

Yet this is just a drop in the bucket to what is needed to fill the job demand.

For Aquinomics, the de facto ideology of current-day Philippines, to attract more foreign fans, jobs will need to start coming online from what has already been seen, proving that “inclusive growth” is more than just a tag line.

 

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