The Philippines is in great shape. It’s in the numbers.

steel asia davao city

SteelAsia mill in Davao City

We often complain about the way things are in the Philippines. We grouse about the politics, the lousy tabloid media, the poverty, the poor storm preparation, the trash and over-fishing, the corruption, the murderous rebels, the crazy bishops, the congestion, the electricity, the slow bandwidth.

Today looks a lot like yesterday, and we don’t figure there will be much change for tomorrow.

But here are two numbers we ought to reflect on:

  • GDP growth at 6.5% a year, plus or minus.
  • Population growth at 1.7% a year and declining.

What are the main factors fueling the GDP growth?

  • Low cost of labor and goods for international delivery
  • Success industries: OFW placements, tourism, BPO, real estate, retail goods
  • People making money are investing money; more foreigners are also investing here
  • A growing base of middle class spenders

Why is there so much congestion and so much demand for internet bandwidth?

Because of the 6.5% growth.

Did you know that an economy growing at 6.5% a year DOUBLES IN SIZE in 11 years? Those who say the economy is the same today as last year are nuts. What they are saying is “I did not get a raise”, or “I still can’t afford to buy a car”, or “my condition is just the same”.

Well, hey, let’s interview the 6.5% beneficiaries, the mall workers and construction workers and transportation workers and banks and fast food outlets and manicurists. The people who have jobs today that they didn’t have last year, or who are making more money this year by riding the increasing demand. Because the numbers are real, factual.

Folks, congestion is bad because today IS different than yesterday, when it accumulates over the years.

In 2026, the Philippine economy will be generating twice its current GDP.

Can you imagine?

TWICE AS MUCH PRODUCTION

If we can get and hold 6.5% annual growth.

Your city will have a lot more jobs. More stores grabbing their part of the action. More manicurists and bank branches. More cars. Higher salaries. Everyone moves up a notch. Jollibee coming to provincial towns. More malls. New industries. More tourists. More fun in the Philippines.

Yet if population increases at an average annual rate of 1.5% per year over that same 11 year period, the population will grow only 18%.

Friends, those numbers are the facts. Filipinos across the nation will be doing VERY MUCH better in 2026. Twice the GDP. Population up 18%.

If we can get and hold 6.5% annual growth.

That is why China today has such a huge base of rich and middle class citizens. China has been generating steady growth for years, firing on eight cylinders consistently year after year.

I would suggest that all those critics trying to destabilize the Philippines and remove the President who has held to this pace of growth just SIT DOWN AND SHUT UP. They are absolutely the worst thing the Philippines needs. So is an emotional, political Senate that obsesses over a battlefield loss and tries to put that load on the President, distracting him for weeks from doing good works.

And the Legislature has gone frozen. Stopped in place. Stopped building. Except for some stalwarts like Bam Aquino who are determined to do good works.

These frozen legislators should figure out how they can be a part of the SOLUTION instead of a part of the problem. How to heal, to learn and move on. How to get on with work, with producing.

You, too, if you like to grouse and complain. Maybe you should figure out how to STOP THROWING WRENCHES into the Philippine machinery and pat someone on the back. Encourage the nation, invest in it, support it. Sacrifice a tabloidian thrill for the joy of achievement.

Like, stop being the brake. Put your foot to the gas.

The solution is very basic, so very, very simple. Even leftists ought to be able to understand it:

Stability.

Steady growth.

The path to Philippine well-being.

The biggest challenge for the Philippines is not “how can we grow”, but how can we stop interfering with growth? How can we hold the ship steady as she goes and not get distracted? How can we prevent this incident or that from stopping the nation’s momentum?

It is wise to think about infrastructure and how to do even MORE than the aggressive work now being done. I wrote a while back about building new master-planned metropolises in Cebu and Mindanao (“Manila is to New York as Davao is to Los Angeles“).

Take is seriously, eh?

A cork in the growth, as congestion is proving to be in Manila, hinders the well being of the nation.

If it takes 11 years to build a new expressway, by the time it is done it must carry twice the volume as before.

Here are a few other things that need to be done:

  1. Thank every OFW profusely. Give him or her a huge welcome and thanks when he or she visits or returns to the Philippines.
  2. Build a real manufacturing base rather than just doing piecework.
  3. Grow tourism, BPO, and freeport services.
  4. Make defense a domestic industry (military and storm response) and stop buying so much gear from abroad.
  5. Buy products “made in the Philippines”. You can’t do that??? (Thank you Senator Aquino, for expressing so clearly what “buy Philippines” means to small businessmen and businesswomen.)
  6. Continue to get rid of red tape and nonsense so that investors find it a pleasure to do business in the Philippines.
  7. Convert agriculture from farming to agribusiness. Stop handicapping the industry by running it as as a social program. Let producers loose. Large farms.  Mechanized farms. There will be jobs off the fields. Plenty of them.

It’s in the numbers.

Make one simple number our national goal. Get every Filipino to help, for the pride of it.

6.5% annual GDP growth, or more

With reasonable education, we can expect another achievement to come naturally. It does not have to be a goal:

1.5% annual birth rate, or less

And for sure, tell the senators who are out to undermine the leadership of the nation, and the leftists who believe ideology can grow jobs, and the crooks who take good money that could be used to invest in the Philippines and put it into Swiss bank accounts or homes in America, to get out of the way.

And all the critics and blame artists? Those demanding resignation a year from elections? The impeachment freaks who think disruption is the way to go? All the self-serving malcontents?

Sit down and shut up. Until you can find a way to help.

Stop bothering  the rest of us.

We have work to do.

Growing our nation.

 

Comments
448 Responses to “The Philippines is in great shape. It’s in the numbers.”
  1. karl garcia says:

    I agree on all points.
    Agri business rather than have land without any idea what to do with it
    Rather than manufacture semicon why not computers.or electronic appliances
    Cars instead of spare parts.

    Military Industrial Complex.
    We love to import like in manufacturing those semicons we export we import first many components.
    If we manufacture everything in the future, we do not need undeliverables from unreliable suppliers. less procurement scandals,less contract scandals,less bidding scandals.

    Property bubble my foot.
    Retail they say malls will be replaced by online shopping.. Nah.

    RH bill must be supported by programs other than PPPP .
    More soup kitchens,day care centers,etc.

    • Joe America says:

      Yep. The do-gooders need to stop doing their kind of disruptive do gooding, I think. Given the OFW stability, the location, the comparatively inexpensive labor costs . . . all that Filipinos need to do is get out of the way, remove the barriers. Simplify.

    • Agree on all points.

      We need to beef up social support for OFWs and their families, which seem like a societal ticking timebomb in terms of socialization.

      I think the mode is large industrial farms are the one who are large enough to handle the risk profile of climate change affected modern farming so a better Dept of Agri and a development plan would be nice.

      We could definitely go the route of developing technology/manufacturing base through the Military Modernization but I fear this would need a shift in the thinking of our generals. But if we can maintain a multi billion dollar military budgets for a decade we have a lot of engineers/scientist that we could entice to comeback and build the industry up.

    • PinoyInEurope says:

      “Rather than manufacture semicon why not computers.or electronic appliances
      Cars instead of spare parts.” Correct. You have to move to the next level.

      At least this is what we in Pisay were trained for – as technocratic modernizers.

      But some circles in the Philippines, I have the feeling, do not really want that.
      It is because they are cozy rent-seekers, not really competitive, just pushy.

      • karl garcia says:

        Negative Nancy, I can dream that the scions of the billionaires will have a completly different mindset. Ejeep is a start, etrykes and so on. Intel did the smallest pc…still needs a keyboard and a flatscreen, we can reverse engineer.Yes we can.
        Next own missile defese system,own patrol crafts,own vessels,own planes,own copters,own guns..the list goes on…

        • PinoyInEurope says:

          True – in fact the most progressive people in todays Russia are the children of oligarchs and Mafiosi who have been abroad and have seen so much more than their parents did when they were young. They are already now creating stuff to compete with the USA. Putin is the last of the old guard, angry and vindictive. The talent of the young is useful for him in some ways including Russian tanks that are now high-tech. But he too will pass.

          So your idea is not far-fetched. Of course the Filipino can. And wants to as you show.

        • karl garcia says:

          Computer boards have precious metals and they just end up in landfills.Why not this typre of landfill mining.Will green peace still protest? Extraction of gold,siver,platinum through landfill mining.While we are at it,waste plastic to diesel can also be done.

    • PinoyInEurope says:

      Now how about a program to jump-start a real shipbuilding industry in the Philippines?

      Start with small and medium-sized craft, make laws to phase out the rusty and dangerous ships that ply inter-island routes and give positive and negative incentives to buy Filipino.

      Next phase – bigger ships for interisland and ASEAN trade. Of course all of these ships can be dual-use, meaning the first stage in building a good Philippine navy and merchant marine. The Philippines has enough good seamen worldwide, the manpower is there.

      • karl garcia says:

        All doable,the current situation is full cost cutting for leading shipbuilders and selling at a loss.Problems are just temporary.
        All manageable supply chain,logistics,find where the problem is then attack to solve.if systemic then do systems thinking.if symptomatic then consult a physician if symptoms persist.

    • PinoyInEurope says:

      Skip the stuff that many are doing – go for Schumpeter innovation, be one of the first in growing markets. Go for the emerging robotics market for example. Small robots using Raspberry Pi as the control unit – that is a very good one-board computer. Quadcopter drones – the military version can be with cameras and guns, use it when the next Marwan comes along to avoid casualties, sell the stuff to partner countries.

      Place things that still need development under state control with overriding authority – for example the creation of a fiber-optics backbone for the Metro Manila region. Main trunk lines can be under the pylons of LRT and MRT, branching out from there. Why not? For newly planned LRT/MRT lines, think about the Turkish Metrobüs system as an cheaper, more flexible alternative: http://en.wikipedia.org/wiki/Metrobus_%28Istanbul%29

      • karl garcia says:

        Money is no object as long as it is not the subject.

        • PinoyInEurope says:

          Metrobüs is cheaper than MRT – no rails needed, only dedicated lanes, bridges and stations. And more flexible: buses leave the Metrobüs lanes where they end and continue as normal buses, meaning you only need lanes on the main trunk lines.

          I was in Istanbul in late 2013, I saw it in action – even dedicated lanes on the bridge between Europe and Asia – you just have to have the WILL and the Turks have it.

          • Joe America says:

            It strikes me that it is hard to be bold in the Philippines. Being bold affects people’s self interests and they turn into ravenously critical beasts.

            • PinoyInEurope says:

              I know – if I had stayed at home, I might not have been alive to write here.

              But then again, Duterte is bold and succeeds in Davao. Because the beasts fear him.

              • PinoyInEurope says:

                Turks also have a common sense of purpose as a nation, always had it.

                No Turk would sell out his own country for self-interest like some Filipino leaders did.

                They have their oligarchs too, press magnate and steel tycoon Dogan being among them, but all are extremely patriotic, so instead of fighting over the cake they make it bigger.

                I remember leaving the Dogan HQ late with some other consultants. Security guards were there, nervously looking at us, and Dogans Maybach was parked outside. Our Turkish colleague told us we better get out fast, it is an unwritten rule that nobody may be in the corridor when the boss passes by. In the car, I asked the Turkish colleague, so he is some kind of Sultan, he said yes, that is true, we and the security would have gotten in trouble.

                An older female project manager told me: I am a witch, someone who has been a project leader in the old days as a woman had to become a witch to survive 🙂

              • My concern regarding him is his being the police, the judge and executor all rolled into one, if rumors are to be believed. What if he is wrong, we threw out Marcos for being a despot,

          • JM says:

            I like this Metrobus idea. I’d probably just commute if they can successfully implement this.

    • PinoyInEurope says:

      http://www.rewistanbul.com/index_en.php?page=haberDetay&id=54

      Does the MMDA have any delegates going here? If not they should think about it:

      Recycling is an area identified as offering huge potential for improving national welfare and has been included in the ‘National Strategy and Action Plan of Turkey’. As Eurasia’s leading trade fair for this sector, REW Istanbul continues to grow in importance.

      According to the ‘National Recycling Strategy Document and Action Plan 2014-17’ published by the Turkish Ministry of Science, Industry and Technology, more than half of the waste generated in Turkey can be recycled. The plan identifies recycling as offering huge potential for improving national welfare across the country. Zekeriya Aytemur, Managing Director of İFO Fuarcılık, organiser of REW Istanbul 2015, the 11th International Recycling, Environmental Technologies and Waste Management Trade Fair in Turkey, stated that he believes that the National Recycling Strategy and Action Plan will make a major contribution to both supplies of cheaper raw material input for production and a sustainable environmental scenario. Mr. Aytemur also added that “One of the objectives mentioned in the action plan is to create the infrastructure required to effectively recycle waste. The technologies, products and services along with their applications required to create this sustainable infrastructure will be exhibited at REW Istanbul 2015 from 11-13 June. He also emphasized that according to data from the Turkish Statistical Institute – TUİK, 19.3 billion TL of environmental expenditure was made in 2013 and the plan make reference to the investment in recycling will be financially supported. “Local Authorities, SMEs, public and private enterprises, responsible for the environment, be able to easily seek financial funds for necessary investments” he added.

      The challenges experienced due to increasing levels of waste as a result of rapid economic growth i.e. industrialization, urbanization and increases in population, the importance of effective “waste management” has continued to become ever more important. Waste management strategies aimed at reducing rapid consumption of natural resources and, converting waste which pose a threat to the environment and human health, has now been recognized in state policy in Turkey as in other countries around the world. Furthermore, with the objective of turning waste into an economic input with value, the Ministry of Science, Industry and Technology has published a National Recycling Strategy Document and Action Plan.

    • PinoyInEurope says:

      http://www.kosgeb.gov.tr/Pages/UI/Destekler.aspx?ref=15

      Something like this could be an idea as well for Philippines:

      Entrepreneur Support Programme

      MOTIVES AND OBJECTIVES OF THE PROGRAMME

      Developing and disseminating the entrepreneurship as the basic factor for solving the economic development and employment issues,

      Establishing successful and sustainable enterprises,

      Disseminating the entrepreneurship culture ,

      Developing entrepreneurship by establishing the Business Improvement Centers (BICs),

      Raising the employment level,

      Supporting the entrepreneurship based on the local dynamics

      Entrepreneurship Support Programme comprises of 3 subprogrammes:

      Applied Entrepreneurship Training

      New Entrepreneur Support

      Business Improvement Centre (BIC) Support

      Applied Entrepreneurship Training

      It includes training and workshop studies of minimum 60 hours (entrepreneurship abilities testings, business idea exercises and business plan preparation)

      Applied Entrepreneurship Trainings can be organized by KOSGEB or other foundations or institutes (universities, ISKUR, professional organizations, municipalities etc.)

      Trainings are arranged for general and specific (youngs, women, disadvantageous groups) target groups,

      No charge from participants.

      New Entrepreneur Support

      This support is available for

      The entrepreneurs who had completed the applied entrepreneurship training and started his/her own business,

      ISGEM entrepreneurs

    • PinoyInEurope says:

      http://www.invest.gov.tr/en-US/sectors/Pages/Agriculture.aspx

      How about this kind of investment promotion and strategic planning:

      According to McKinsey and Co., Turkey offers significant investment opportunities especially in the agribusiness subsectors such as fruit and vegetable processing, animal feed, livestock, poultry, dairy and functional food, aquaculture, and enablers (in particular cold chain, greenhouse, irrigation, and fertilizer).

      As part of its targets set for the agriculture sector, by 2023 Turkey aims to be among the top five producers globally. Turkey’s ambitious vision for 2023 envisages other grandiose targets including:

      USD 150 billion gross agricultural domestic product
      USD 40 billion agricultural export
      Becoming one of the top five countries in terms of agricultural production
      8.5 million hectare irrigable area (from 5.4 million)
      Ranking number one in fisheries as compared with the EU

    • PinoyInEurope says:

      http://en.wikipedia.org/wiki/2023_vision

      Atatürk’s nation has its goals:

      The 2023 vision is a goal list of the Prime Minister Recep Tayyip Erdoğan adminsitration to achieve by the 100th anniversary of the establishment of the Republic of Turkey.

      Economy

      Become one of the top ten world economies

      Gross domestic product of $1 trillion by 2014

      Gross domestic product of $2 trillion by 2023

      Increase annual Turkish exports to $500 billion[1]

      Per capita income of $25 000

      Foreign trade volume of $1 trillion

      Increase the employment rate by 10 points to a working population of 30 million

      Reduce the unemployment rate in to 5 percent

      Energy

      Build 20 000 Megawatt installed capacity of wind energy and 600 Megawatt installed capacity of geothermal energy[2]

      Reduce energy consumption to 20 percent bellow 2010 levels through improved efficiency[3]

      Three operating nuclear power plants

      Health care

      100 percent participation in health insurance systems

      Raise the number of physicians per 100,000 people to 210 physicians

      Transport

      Build 11 thousand kilometers of new railway and expand the high-speed train network

      Build 15 thousand kilometers of divided highway

      Grow ports to number among world’s 10 largest

      Domestically produced airplanes, unmanned aerial vehicles and satellite[5]

      Tourism

      Be the fifth largest tourist destination[6]

      Host 50 million visitors per year

      Obtain 50 billion USD of tourism revenue[7]

      • Joe America says:

        The simplicity of the approach suggested in the article is intentional. I think President Aquino grasps metrics, but most of the nation does not. So I thought I’d start with two numbers. Sometimes too many goals is counter-productive. They can be left with NEDA, which has way too many in the National Development Plan. The popular “rah rah” target need be only two numbers. All the rest flows from them.

        • PinoyInEurope says:

          No criticism meant, just adding to the brainstorming. Does NEDA have any simple, easily understood websites like the Turkish government has? Is there anything like Erdogans national development plan with measurable goals that are the guidepost for everyone?

          Your two numbers show that the basics are there, nandiyan na ang agos ng tubig. Next thing is to harness and control the energy from the raging river.

          • PinoyInEurope says:

            As one can see from Turkish government websites, ALL agencies take the national goals as there guidepost and are working on them in one direction.

            I do not ask for the people to understand everything, the government should have one direction though so that by 2026, the basic foundation has been laid.

            Upon this foundation the economy can move to becoming a competitive market instead of just a cost-benefit market like now, the government HAS the competent people

          • Joe America says:

            I’ve not done the comparison. The NEDA site has good information and updates on plan progress, a little dated I believe. Also a listing and updates on all major infrastructure projects. It was the source of a blog I did a number of weeks ago parsing the infrastructure investments. My problem with the development plan is that it is too detailed to be read and possibly even tracked well. But for sure a great deal of right-thinking went into it. I would suggest that you tour the site yourself, as primary research would be better than me trying to translate.

            • PinoyInEurope says:

              Will have a look at it. But that again is my point – too little top-down thinking in the Philippines. Too detailed and too little outline – the BOI report is an example of this. For all faults of the Poe report, it does have an outline and a top-down structure that I respect.

              The Turkish goals are divided into areas and are very trackable. Seems from what I have seen that every ministry takes it upon itself to subdivide the goals into subgoals. Classical MBO applied to national development, Turks have come very far from where they were.

              • Joe America says:

                Your conclusion is made without any factual basis, which is a strange way to operate. There is clear top down direction in the Aquino Administraton. The cabinet is run like a business organization. Metrics are front and center, and when they come up bad (as poverty has), then priorities are adjusted. The difference is Aquino relies on the facts to manage and Poe juggles the facts to point to a political conclusion.

              • PinoyInEurope says:

                I only can judge on the basis of the facts available to me (BOI report, what you told me about NEDA) plus what I have seen – and it is not my goal to disparage Aquino or sing the praises of Poe. Now if you are telling me now that the Aquino Administration uses metrics, it is a good thing and I am even more satisfied. I once noted that Salceda uses metrics and communicates them and goal achievement very transparently via his Facebook page.

                It is not my goal to politicize – it is my goal to observe and note, and if someone adds new facts to my observations they are thankfully added to my inputs. Just one question – does Aquino use metrics to define his goals, does he make tracking the basis for his SONA?

              • Joe America says:

                The nation will never climb out of its hole as long as people cherry pick the findings to illustrate what is wrong, and fail to look for, or deny findings that suggest diligent work is being done. It is the matter of the glass, which will always be considerable distance from full. If the empty part is the basis for judging the Philippines, whereas others are held up as icons of virtue (Turkey) because the facts cited are from their full part, then why even have a conversation? The conclusion is already pre-determined. The Philippines is a loser.

              • PinoyInEurope says:

                Don’ t worry, I shall do some of my own research on this. It is interesting to see not only how goals are used but how they are tracked and especially how they are communicated.

              • PinoyInEurope says:

                Thanks. Then it is even stranger that the media hardly make that transparent.

                Again: I will have a look at the President’s Webpage – and his old SONAs.

              • Joe America says:

                “. . . even stranger that the media hardly make that transparent” That’s effectively what President Aquino said yesterday or maybe it was the day before.

                The popular media are purveyors of emotion and conflict, not information. They are a major contributor to the negative view that many Filipinos have toward their nation and its leadership.

              • PinoyInEurope says:

                “The Philippines is a loser.” No, probably not as good at selling itself as Turkey.

                What dominates and creates a negative impression is what is seen in the media.

                Now I mentioned Turkey because I saw how they are getting their act together – as a positive and constructive example of how things could be done. Again I have been surprised that the Philippines is also doing a lot of similar things. Very interesting.

                You have been a salesman. Now imagine you are selling a product – Philippines – which has gotten an unjustified bad image. You shouldn’t get mad at the people who have gotten that bad image, you should be happy for every person who is willing to listen.

                Lesson learned for me: research a little bit more. Like I have done recently for BBL.

                Now I understand your desperation – but you must also understand then that selling the Philippines to its own people is a really hard sell, if even well-meaning and educated people like me are very disillusioned and still have difficulty believing things get better.

                I mentioned MBO and development plans many blog articles ago and got no response. Forgive me for thinking then that except for Salceda, nobody else is doing it. C’est la vie.

                Maybe exactly these discussions are a way to promote more awareness – mine included.

              • Joe America says:

                Well, frankly, I can’t keep up with reading all your comments. I agree getting good information is an uphill battle, which I see daily in reading the Inquirer, generally considered the best paper here. Today they feature a report on the front page that uses a single unverified source to state the President was in Zamboanga to receive Marwan, dead or alive. This over the explicit denial from the Office of the President. A number of weeks ago, a very clear chart was presented showing the level of infrastructure investment the Aquino Administration has been making in office, rising to hefty multiples of what was done previously. How much play do you figure that got in Philippine media?

                Right, zero.

                That is why here, and in dialogue threads at the Inquirer and elsewhere, you will see me relentlessly attacking the Inquirer for unethical journalism. It may be uphill, but for sure, if we don’t trudge the path we’ll never get there. You too often seem to represent the tree roots always reaching out to grab the foot.

              • PinoyInEurope says:

                “The popular media are purveyors of emotion and conflict, not information. They are a major contributor to the negative view that many Filipinos have toward their nation and its leadership.” Agree 😦

                Plus the cognitive filter aka bias that many of us Filipinos have, our negativity which we must overcome – the main tenor of my blog article for Easter Sunday. Resurrection and moving forward with confidence into the future, as former underdogs, but no longer victims.

                Most Filipinos are not as open and forthright as me, so consider me a sounding board for what must be emphasized to convince Filipinos that things are getting so much better. Others will simply heckle or not believe, I know my own folks, I know why I avoided them.

              • Joe America says:

                Well, I look forward to the day when you turn your considerable intellect away from being the sounding board or devil’s advocate, to an enthusiastic believer in the many good Filipinos who do what they do in an environment that seems to be stacked against them everywhichway. President Aquino is one of those slogging the loyal slog. He has his quirks and makes his mistakes, but he has made huge strides against very determined opposing forces. Including the ignorant as well as the manipulative.

              • PinoyInEurope says:

                Like I wrote, I will research a little bit more – but do not be surprised Joe if many of my countrymen do not. We Filipinos are used to the path of least resistance, and many of us do not react with arguments like me. Instead the reaction is sullen vindictiveness.

                My personal experience is that it takes enormous patience to educate Filipinos, to win their trust and loyalty is even harder. Kudos on your endurance in doing this Joe.

              • PinoyInEurope says:

                “Well, I look forward to the day when you turn your considerable intellect away from being the sounding board or devil’s advocate, to an enthusiastic believer”.

                Never fully enthusiastic, but more convinced. That is why being a leftist never was for me.

                Just wait and see – my BBL article is a devil’s advocate article that challenges the assumptions of the BBL detractors and shows a possible way to make BBL really good. Points out major errors in the BBL and suggests solutions to secure its future.

                My Rising Article is an appeal to countrymen that is unique coming from the heart.

                “President Aquino is one of those slogging the loyal slog.” Of that I am now convinced. What he is creating has a real foundation and is not just a short-lived boom like mid-90s.

              • PinoyInEurope says:

                And that real foundation can be built on by any good President that comes next.

                The reason I can never be a true believer in President Aquino, only convinced, are the policy accents he is placing. My direction is more in the direction of modernized nationalism like that practiced by Turkey and Germany. Therefore, a modernized Nacionalista party would be what I definitely prefer – I look forward to your blog article on Tuesday about this. And I commend your fairness, even though you lean more towards LP.

                What I also hope for is a modernized center-left, like Walden Bello but better. Then the Philippines would have all three directions – center-right, liberal and center-left. LP is undeniably the most modern party at the moment, but one good party alone is not enough.

    • PinoyInEurope says:

      http://en.wikipedia.org/wiki/TAI_Anka

      and of course the warrior Turks have their own drones already:

      The TAI Anka is a family of unmanned aerial vehicles (UAV) developed by Turkish Aerospace Industries for the requirements of the Turkish Armed Forces. Basic Anka-A is classified as a Medium Altitude Long Endurance (MALE) UAV. Envisioned in the early 2000s for tactical surveillance and reconnaissance missions, the Anka has made progress towards the integration of Synthetic Aperture Radar and combat systems. The drone is named after a phoenix-like mythological creature called Zümrüd-ü Anka (alternatively called Anka kuşu (Anka bird) in Turkish.)

      kailan tayo magkakaroon ng Darna drone?

    • PinoyInEurope says:

      To pick up Mary’s post on Singapore yesterday: Turkey is an authoritarian democracy with very paternalistic leaders. The culture is very clannish and traditional, in Anatolia they are still almost like Moros in attitude, many Turkish migrants to Germany carry that old culture.

      I believe, given what Duterte has achieved in Davao, that he may develop the Philippines in authoritarian democratic Turkish style. Give an unruly and divided people direction. There are other models than the also valid neoliberal approach which Mar would take.

      • Mr. Peter Wallace, a columnist at Inquirer, has this to say, (and I agree with him, though JoeAm is more encouraging and positive) :

        ……” with his term approaching its end, instituting long-needed reforms to at least improve a little the life of the poor has become difficult to achieve. But he still can do it, although the task will be more demanding now, or shall we say, he needs to be more dictatorial (in a positive way) than he has acted in the past.

        Mr. President, don’t tolerate bureaucratic nonsense, just insist on the reforms.

        And beg the courts to cooperate, it’s the least they can do. I still can’t believe that the Court of Appeals issued a temporary restraining order to stop the enforcement of the Ombudsman’s order suspending Makati Mayor Junjun Binay, despite the slew of evidence linking him to criminal transactions. Can’t the Supreme Court decide in a more enlightened way?”

        Read more: http://opinion.inquirer.net/83624/its-not-too-late#ixzz3VhzJWQhQ

        • Joe America says:

          The thing about the courts is that it is left to you and others to recognize the horror of a court that is blind to justice and none within the judicial community will speak out. It’s like they don’t care if their entire profession is tarnished as a batch of clowns on the take. It’s a lot like Senators, now that I think about it, as Senator Marcos ambles off to yap about running for the presidency, one of the qualifications being his two degrees from prestigious schools. A wrong never righted by people who don’t care if their colleagues are scurrilous liars.

    • PinoyInEurope says:

      Come to think of it, the dream team in my view would not be Mar-Trillanes, it would be Duterte-Trillanes. Their approaches are more compatible and complementary. Yes.

    • Yvonne says:

      Decades ago, as I remember, one of the main hurdles for the expansion of our trade and industry was our very unreliable communication. Companies cannot transact their business over the phone promptly and efficiently because our phone system was very unreliable. And this became a deterrent to foreign companies who want to put up local operations.

      Now one of the major hurdles seems to be our unreliable power supply – rolling blackouts and unscheduled brown-outs. For instance, how could manufacturing companies, for instance, run efficient and profitable operations when their people and machineries become idle unexpectedly when commercial power comes down?

      This is one area that we need to address seriously and urgently if our country has to continue and accelerate its economic development.

    • IT IS STILL CORRUPTION THAT SHACKLES THE DEVELOPMENT OF THE ECONOMY. JUST RECENTLY LEPANTO CONSOLIDATED AND GOLD FIELDS OF SOUTH AFRICA SUED THE DENR, BUREAU OF MINES AND THE NATIONAL INDIGENOUS PEOPLE COMMISSION FOR THE RENEWAL OF THE MINING CONTRACT THESE PHILIPPINE GOVERNMENT ENTITIES ARE ASKING 6 BILLION PESOS TO RENEW THE MINING CONTRACT IT IS NOT IN THE MINING LAW!

  2. PinoyInEurope says:

    Joe, many thanks for this important article. Growth is definitely the main thing, and keeping it. And of course stability is very important for this – which is why I am writing about the BBL on Sunday.
    Without risk management the whole Muslim issue will explode in our faces again, sooner or later.

    “We have work to do.” Good. Now there are many Filipinos abroad who would like to come back at some point, even if it is only for retirement. A lot of us have skills we have learned abroad, some of us may want to do a little business – also something that promotes growth.

    Now you wrote one very important point: “Continue to get rid of red tape and nonsense so that investors find it a pleasure to do business in the Philippines.” Very correct. Until now public perception in Germany where I live is dominated by the unpaid bills for the NAIA-3 terminal.

    Now if a big company like Fraport has to be afraid not to get paid – I don’t care about the details and administrative/legalistic internals here, Joe it is quite simple, if you order something and get it delivered you pay for it, period. Germany does not give so-called Hermes credit guarantees to companies that want to invest in the Philippines anymore, meaning only heavyweights like SAP go there who have the volume to shoulder the risk and the money to pay lawyers if it is necessary. Now Filipinos abroad/returning may make a big difference if they invest and run own businesses.

    Knowing the Philippines – tell me if THAT has changed – it is practically impossible for someone who is not part of certain in-groups to get in, the perception from the reality we know before is that the game has always been rigged by insiders, by rent-seekers. What can be done to make investment and starting businesses by returnees/OFWs simpler? For BPO this has been done. Lots of small investors can make a difference as well. But for that, fairness must be guaranteed. Kung gusto mong manatili ang suwerte mo, huwag kang suwapang. Hope the LP/Makati gets it.

    • Joe America says:

      Fraport is an interesting case. It is not quite as simple as the Philippines not paying. http://www.philstar.com/opinion/2014/12/12/1401697/phl-wins-5-m-against-fraports-slandering

      • PinoyInEurope says:

        Very mixed bag for sure. Fraport is Fraport. But the Philippine government could do more to fix trade relations with Germany. There are some large German BPO outfits in Makati, but there could be more investment. Much more German business goes to Indonesia.

        The perception from my side is: if you are a Makati type or an American, Philippines is good for you and doors are opened, if not you get shoved aside. Or has that changed?

        • Joe America says:

          Efforts to remove red tape are being made, and a lot of work within Asia to promote investments here. I suspect there is more to be done, and maybe that would be a better use of Senate time than beating the Philippines black and blue over a battlefield loss.

          • PinoyInEurope says:

            “I suspect there is more to be done, and maybe that would be a better use of Senate time than beating the Philippines black and blue over a battlefield loss.” fully agree.

            The main issue is not the loss anyway, it is the Moro question, they are losing their focus, either out of emotionality or out of stupid self-interest. That is why the article tomorrow tries to make potential risks out of fears and manage them, not fear them. Fear flat tires? It’s a risk, not likely to happen to all four at once so you have one spare tire in the trunk. Fear crash accidents? Fasten your seatbelt. Fear vampires? Take some garlic with you.

            Remove red tape, centralize information, make sure the judiciary is not captive to the vested interests of rent-seeking groups that will try to destroy any new competition.

            As for me, I have an enlightened self-interest in a Philippines I may return to someday, maybe for retirement, maybe for part of the year, or even just for some longer vacations.

            People in the Philippines not being too poor is ALSO enlightened self-interest, having gotten used to European conditions where there are almost no gated communities, I would like to be able to live OK without having to fear kidnapping, thieves or holdups always.

            • Joe America says:

              If you need a German lifestyle, the Philippines is probably not the place where you want to settle. Most westerners here spend a lot of the day collaborating on their complaints. I avoid them at all costs. For myself, I would find a traditional safe American suburb very very boring. I like the richness here. There is very little crime on Biliran Island. Yes, the contractors will all try to game you for all they can get. Maybe a sneaky painter will take off with a gallon of paint to supplement his measly P250 day salary. If they work a day wage, they’ll work slow. If they work on a project basis, they’ll work quick and sloppy. Hey, life’s like that. Poverty is everywhere, but it is a rather constructive, sometimes self-imposed poverty as people choose not to work, and to lean on the relatives. You can hire household help or a driver, or gardener. I can’t do that in the US. So one does the old t-chart, runs up the pluses and minuses, and makes a choice. I for sure have no regrets. I am hooked on the Philippines.

              • PinoyInEurope says:

                That is the province you are talking about. Sounds quite relaxed and safe, OK people try to game you here in Germany as well, come on. If I chose to live in Albay again, that would be my lifestyle as well, nice and easy. Not really a problem though.

                What I mean is Manila, where the differences are so jarring – very poor people see a very modern world in front of them that they cannot access easily. Where you need hours to get to work because of traffic, where I have heard it can be quite dangerous. If it were just a little bit more like say Kuala Lumpur or Bangkok I would be pleased to go back there. Simple reliability and more predictability without losing the nice sides of Southeast Asia.

              • Joe America says:

                Congestion is a big problem, for sure. Manila is developing as you would want to see. Modern high rise complexes, the new casino district, Roxas Boulevard being upgraded, freeways being built. A lot of the problem on the roads is from construction. I have never felt unsafe in Manila, myself, except up by the docks. There are areas of Los Angeles that are a lot worse. The airports have been significantly upgraded, but they, too, are congested. Manila is not yet Singapore, but it is heading that direction. Maybe others have better insights. I only visit now and then.

              • PinoyInEurope says:

                Don’t like Singapore – too sterile and too stuck-up. MODERN Germany is very laid back compared to it. The arrogance of the people in Singapore pisses me off as well, forget it.

                Similar to Bangkok would be enough for me – free-wheeling and fun but with a reliable MRT and other services at the more or less the same level as the rest of the world.

                And a reliable police force, crime can happen anywhere, but hulidap is typically Filipino.

              • karl garcia says:

                Bangkok? No traffic?

              • PinoyInEurope says:

                Bangkok traffic is living hell but the MRT works and you don’t have to stand for hours to get in.

              • karl garcia says:

                The rapid Bus system had a dry run last week at EDSA.
                It is equivalent to to two buses they have less stop overs….etc.

              • PinoyInEurope says:

                Excellent. Now imagine how many readers of this blog we are hereby giving new information. Many of us including me are not stupid or uneducated, but often ignorant.

                Thank you for filling in things karl and removing the pout from my face. 🙂

              • PinoyInEurope says:

                So the queues will soon be a thing of the past – also very good.

              • karl garcia says:

                https://joeam.com/2015/01/18/

                get a read of this

              • PinoyInEurope says:

                Done – including the great Mindanao article. Thank you.

              • PinoyInEurope says:

                One good source on ease of doing business: http://www.business.gov.ph

                So they do have a one-stop-shop after all, that is encouraging.

              • karl garcia says:

                Have a nice day! 🙂

              • karl garcia says:

                More resources of studies.
                The Senate Economic Planning Office.

                https://www.senate.gov.ph/publications/sepo_publications.asp

              • PinoyInEurope says:

                Coming soon: philippineprogress.de

                I will like all these matters on a dedicated webpage.

                See my posting on that far below as well for more details.

  3. winky says:

    Yup, people should really just shut yup. The numbers have always been awesome during the Marcos, Cory, Ramos, Erap, Gloria and Aquino era. There is nothing to see here folks. Seriously, investors have been flocking in so much because it’s just way too easy to set up shop in the country.

  4. cetootski says:

    agree on all points, except you failed to mention our problem with inclusive growth or rather our lack of it. we might double our economy in 11 years but how much of that doubling will be in the hands of henry sy? these people do not care for the average joe only their bottom lines. our generation’s great war is against the widening income gap.

    • Vicara says:

      An expanding economy across sectors would mean the creation of more jobs requiring more sophisticated skills. And that means a more competitive, educated workforce that will want to work for more than peanuts. This is happening now in China, particularly in the coastal cities where skilled workers are becoming scarcer. There was a time when SEAsian manufacturers were frustrated by the competition from China, where overhead used to be lower, and employees worked at a ferocious pace 24/7, it seemed. That’s not the case anymore.

      • Joe America says:

        Excellent point. I rather think markets fix themselves. If businesses need the talent and have to pay for it, they will. Eventually, the nation’s cost advantage will erode, but that’s good. The economy will be big enough and deep enough to morph to a competitive market instead of just a cost-benefit market.

        • PinoyInEurope says:

          Excellent. Even better if the government thinks, on time, of using the revenue it earns from the present boom to create the basis for a competitive economy. The stuff josephivo has been posting recently – education, getting people out of poverty.

          Plus active promotion of basic and applied research – from what I have heard, DOST is doing some stuff in this direction. Including sending scholars all over the world.

    • Joe America says:

      It depends on what the rich do with their money. Right now they are plowing a lot of it back into the Philippines, and they have the resources to do the big jobs. Capitalism is the driver of wealth creation, and it does flow downhill, maybe not as fast as we would like. The statistics suggest progress is being made, and for sure in our area there is a lot going on, commercial buildings on the rise, a sizable middle-income base forming, good homes going up (seamen mostly, OFW’s, business people, and European/Aussie/American retirees) bamboo huts coming down and replaced with hollowblock structures. By 2026, the rampant poverty will be fading, I am quite confident.

      The worst think, I think, would be some kind of socialist program that would disrupt what is going on now.

      • PinoyInEurope says:

        Real competitive capitalism is good, definitely. The kind of rent-seeking the Philippines has had so far that CALLED itself capitalism but was just modernized feudalism is harmful.

        No socialism please – but more social services to further equal OPPORTUNITIES.

        And some jumpstarting for local industries by improving the conditions for them by using tax money the government earns from the foreign BPO and manufacturing companies.

  5. Jose Guevarra says:

    Presidents have always been credited or blamed for the economies of their respective countries. Thsi is not to belittle PNoy’s own accomplishments, but simply to point out that he does not deserve all the accolades as well. Still, he has done a good job in making sure that growth has so far been sustained. Now if only he could find ways to make it more inclusive…

    And with sustained economic growth in the Philippines, this is really an opportuned time for him to take strides in nation rebuilding as well. By this, I mean really start the healing process over some unfortunate incidents. Mamasapano, Yolanda, etc. I know he has accepted responsibility for these but why can’t he, for once, give into the sensitivities of his people and apologize? Presidents are human, too, and thus have shortcomings, just like any other person does (maybe based on wrong information fed to them or misinterpreted information). “I was given wrong information, I am sorry for not making the right choice at the time,” or “I thought I was completely making all the right moves based on information that was given to me. I am sorry my decisions somehow led to the unnecessary loss of lives of our men,” or “I am sorry for the deaths of your friends and family, we had no means of knowing the actual extent this catastrophe can cause beforehand, but we will do everything we can to alleviate your pain.” He is Filipino as well, and I am sure, he understands where the vast majority of his people are coming from. Never mind the politicians, the bureaucrats, the experts, the intellectuals. Just this once, I would like to see him really listen to the common people, the almost 80% who are still unsatisfied, and say “I am sorry.”

    • PinoyInEurope says:

      I’m sorry would be a little to much, but something similar to the Spanish lo siento in sense would be better – meaning to show that he actually sincerely FEELS for his own people and understands their pain.

      The entire distrust around him has to do with non-inclusive growth, and the people probably feel: is he doing this for us or just for the other rich people? Does he care at all about the SAF 44 or are they just expendable like the rest of US are for THEM?

      Now if he can get the common people to TRUST that he is not only the President of Makati but there for the whole nation, then he would have more pull and could neutralize Binay. Who could otherwise use distrust of the rich and fear of being left behind again very easily.

      • Joe America says:

        Man, I’m gonna go nuts. I write a blog aiming for uplift and y’all keep dragging it back. Let go of Mamasapano, it is a drag on performance. Get over it. Grant President Aquino the respect for stabilizing the nation, righting the financial ship, and generating growth. People bitch about DAP and don’t realize what he was trying to do, jack up the growth.

        I get so tired of this negative crap, really.

        • PinoyInEurope says:

          Wrote that post before giancarlo posted the link. Noynoy has in my view addressed that, with his speech before PNPA. IMHO he has now given the issue closure, see posts below.

      • Jose Guevarra says:

        Nope. It still falls short of including three little words.

        • To every Filipino who has felt failure or has been hurt because of the events related to this operation: It is with the abiding humility that I ask for your deepest understanding.
          ->PNoy

          20 plus words not enough?????

        • Joe America says:

          I for one am pleased to have a president who will not prostitute his values to apologize to people who seem to me to be way too needy. He did nothing wrong, why the hell apologize, and why do you need for someone else to help you get over this tragedy? You can’t do it yourself?

          • PinoyInEurope says:

            “You can’t do it yourself?” That brings us back to the topic of maturity. I’m asking MYSELF now why I needed that speech from Aquino to give closure. But many countrymen will be caught at a level where they don’t even ask themselves that. Some will continue to gripe.

            The economy is going up, but the nation has not grown up enough yet. Hope that these national growing pains are soon over. Let’s see what happens after summer vacation.

            • karl garcia says:

              We must learn the difference between empathy and sympathy.

              • PinoyInEurope says:

                Something like that. The SAF44 were Filipino EVERYMEN, which is why so many including those so far away like me identified with them as kapwa. They were dismayed because Noynoy did not seem to care, did not seem to see the ordinary Filipino as such.

                Noynoy might have felt for them just as much as everybody else, but he has a hard time connecting to his own feelings I believe – consider the trauma he experienced plus the bullet still in his neck, so that is probably the reason some think him cold and uncaring.

                Now I have come to the conclusion that he does care and has done a lot for the country, not everything right but who does? A lot of us Filipinos are hardened by bitterness and distrust, me included. But GRP people much worse, they are caught in a vicious cycle.

                These events have brought me back in spirit to the country I left as a hopeless case. Furthermore, they have brought me back to the faith that I abandoned even before. Sometimes pain is necessary in order to start a process of healing and redemption.

                Joe, please schedule my next blog article “Overcoming Victimhood” for Easter Sunday. Have found the theme I was missing for my underdogs must overcome victimhood thing. Will place Underdogs overcoming Victimhood into the context of Christ dying and rising.

              • PinoyInEurope says:

                And also: the SAF 44 and 25 Moros dying, and the nation rising out of their sacrifice.

                That tears must be shed in order to find new joy. That one must first despair to find hope.

                That Jesus, the underdog, first had to be a victim on the cross to rise again triumphant.

              • PinoyInEurope says:

                “Rising from Victimhood” will be the title of the blog article. The idea is now fully formed, writing it down will be a very quick thing after I submit the BBL article.

                Staying in victimhood is the trap many Filipinos fall into, as witnessed in the events of the past two months – I think the message is overdue and the time is just right for it.

            • PinoyInEurope says:

              “Will do.” Thanks. Next productive project.

              Keeps me focused. Will post even less now.

              • i7sharp says:

                PIE to Joe:
                x-
                Joe, please schedule my next blog article “Overcoming Victimhood” for Easter Sunday. Have found the theme I was missing for my underdogs must overcome victimhood thing. Will place Underdogs overcoming Victimhood into the context of Christ dying and rising.
                -x

                PIE,

                Not meaning to distract you, but some food for thought for you:
                1.
                Question:
                Christ rose from the dead on an early Sunday morning (1st day of the week)
                or on Sabbath day just before sunset (Sabado, 7th day of the week)?
                (As far as I know, He was buried just before sunset.
                Exactly 3 nights and 3 days later would be “just before sunset,” right?)

                A google on “two sabbaths …”
                http://j.mp/i7w-25

                2.
                Jesus Christ is the creator of the world.

                i7sharp

              • PinoyInEurope says:

                I already finished the first draft, but it will still change I am sure.

                Christ became an underdog by choice by becoming human.

                His disciples were all masa except for Judas.

                He fought the Pharisees even though he came from them.

                He would have fought the Mitsubishops in today’s Philippines.

              • PinoyInEurope says:

                I have already finished the first draft, it shall ripen.

                Jesus Christ became an underdog by becoming human.

                All his disciples save Judas were ordinary people, masa.

            • PinoyInEurope says:

              oops, thought my first post was lost, condensed it. Just await my blog article.

        • josephivo says:

          I keep repeating that education is important, also adult education is some cases it seems.

          The Philippine logic “I feel it this way so it must be universally true.” is not a correct logic.

          • PinoyInEurope says:

            Now I am doubtlessly educated and well-read, but I admit that I too often have that fault. More of a maturity thing than abstract education. Miriam Santiago has a doctorate, but she is far from being a mature person from the emotional point of view – very low EQ.

      • PinoyInEurope says:

        Very good. That is exactly what I meant above:

        It deeply saddens me that there are families who are now without a husband, a father, a brother, a son, because of what happened in Mamasapano. I am saddened by the fact that, despite my effort to give the families space to grieve, as they were to meet their fallen loved ones for the first time, some people found fault in this by calling me cruel or without regard for such loss…

        To every Filipino who has felt failure or has been hurt because of the events related to this operation: It is with the abiding humility that I ask for your deepest understanding.

        Show that he feels for his own people, very important.

        He does not have to say sorry. That is a personal choice.

  6. Vicara says:

    Most people in Manila and outside think of Mindanao as a scary, poverty-stricken drag on GDP, largely because of the volatile security situation, the bogged-down peace process, and most of all because of noisy political theatrics, particularly in the wake of sensationalized events like Mamaspano. But if I were an entrepreneur wanting to set up an agribusiness, real property project, call center or training college for OFW-friendly industries like the international merchant marine, I’d get out of overcrowded metro Manila. I’d put my money on Mindanao. Think of its large land mass with decent highways–much better than EDSA, I can tell you!–connecting cities like GenSan, Koronadal, Cagayan de Oro, and Davao, its international air links, and the energy of people who’ve seen it already come a long way since the first peace agreement was signed (with the MNLF) in 1996. Talk to the Japanese who’ve settled in Davao and the Koreans who’ve set up businesses in CDO. I visit those cities every few months, and each time I see new restaurants and offices, set up by entrepreneurs taking advantage of the low overhead and labor pool. For now–knock on wood–the current armed fighting is a gurgle compared to the “all-out war” of 2000. But even during that military venture, which exacted an economic cost in the affected areas, exports from Mindanao actually rose. So think ahead to what it will be like when a peace agreement is finally being implemented.

    • PinoyInEurope says:

      If implemented properly, it will be very good, if not things can go backwards. Worst case would be similar to letting Binay leech of the wealth of the Philippines, only that the thieves would have Arabic sounding names. Anyway more on that in my Sunday blog article.

      Re Mindanao: reasons why I see Duterte as a serious presidential candidate is because of what he has done for Davao, his constructive criticism on Mamasapano and BBL, plus his grassroots approach combined with clearly defined rules and pragmatic thinking.

    • Joe America says:

      Yes, click on the link within the text of the article, and you will see that idea laid out, because it is exactly the way a bold nation would behave. Mindanao has soooooooo much potential. Conflict there is a huge block that prevents the Philippines from realizing its full potential. The BBL might just unplug that potential.

      • Visited Mindanao 8 years ago went to the major places by sleeping in a bus because didnt have nearly enough money for hotels and almost fell in love with the place. Was jilted out of the fantasy of settling there when a local from GenSan I sat beside bored me to death with conflict porn either from NPA rebels or MORO rebels. Funny how that person ended with how mindanao is really peaceful and an excellent place to be but seems to emphasize the bad parts more.

        Would love to revisit the place with a more open mind one day.

  7. karl garcia says:

    RSA says infrastructure key peace to Mindanao. He cited Batangas as example.

    http://www.philstar.com/business/2015/03/25/1437131/infrastructure-key-peace-mindanao-ang

  8. josephivo says:

    All correct, but I would like to add two.

    – K12 and education. If the Philippines wants to be more than the household workers of the world they will have to compete for the better jobs with better qualifications.

    – Pantawid Pamilyang Pilipino Program, 4 million families got help in feeding and educating their children. Poverty is inherited, this program helps to break these automatism.

    Faster growth is a must to escape the Malthusian trap, growth totally erased by more and longer living children.

  9. David Murphy says:

    Joe, I think I understand that in this article you are focusing on positives and don’t want to give too much column inches to negative aspects. You skimmed over corruption with a comment on crooks who take their money out of the country. You can look at the following little exercise as being positive or negative, depending on which result you focus on. It’s a simple computation of compound growth which many of you may already have seen. To illustrate the power of compounding, assume that you get one peso doubled every day for 30 days or weeks or years, whatever you want. On the first day you get one peso, on the second day 2 pesos and so forth. By the 30th day you will have accumulated just a tad over one billion pesos.
    I read somewhere a few years back that graft and corruption amounted to around 40 to 50% of most large scale government projects in the Philippines. I began to wonder just how much this skimming off the top would affect economic growth so I did the same exercise except that 0.25 pesos was withheld from the growth, as when someone demands a share of the cost of building a condo in Makati. Thus, on the first day you get 0.75 pesos, on the second you get 1.50 pesos and so forth. On the 30th day, instead of having more than one billion pesos, you have just a tad more than 400 million. And that was using a relatively low percentage removed from the economy, as opposed to the levels that I’ve heard bandied about.
    The point is that the growth in GNP indicates a great future for the Philippines. But how much greater would be the growth if dishonest politicians and bureaucrats could no longer routinely divert a significant portion of the government revenues and expenditures!? Corruption and graft are major brakes on economic growth and prosecuting such economic crimes and recovering the stolen funds would be a major factor in fostering the growth in the economy. And I believe that the poor would at last be able to share in the benefits, either directly from the growth in employment and wages but also in government action such as improved education for all, better health care and nutrition, just for starters. Six hundred thousand pesos out of every one billion pesos that would no longer be lost would make the Philippines a different country.
    How’s that for positive thinking?

    • sonny says:

      David, half-filled versus half-empty? Or not as simple?

    • Joe America says:

      The article is more about being smart than being positive, and getting the sucking sound out of the economy from all the moneygrubbers moving money to their best interest rather than the Philippines’ is very, very smart. All the more reason to accelerate the prosecution of thieves. Double the DOJ staff. Double the Ombudsman’s staff. Money well spent to get rid of that siphon.

      Excellent positive, constructive, smart thinking.

  10. i7sharp says:

    “Shmita in Luisita”

    I checked a few minutes ago to confirm that “shmita” has not been mentioned previously in any of the threads here in JoeAm’s blogsite.

    (I did not check on “Luisita” because I have no reason to doubt the Aquino hacienda has been mentioned in the site more than once.)

    Those who feel uncomfortable with the Bible can begin with this:
    “Shmita in California”
    http://j.mp/rp-sh01

    Those who are more … er, daring … or not afraid to be bored … can jump to this:
    http://j.mp/i7weeks
    May I mention that earlier today I uploaded to its Files section
    “Jesus (Friend to Terrorists)”?
    IMHO, reading it will help one gain insight about the BBL.

    My main point:
    Shmita can make for a much better Philippines.
    (The Jews paid dearly – 70 years – for not heeding God’s word on it.)

    i7sharp

    • sonny says:

      It seems that Shmita is in direct opposition (going the other direction) to going the way from
      farming to agribusiness. Unless either philosophy will be applied judiciously where either one is most appropriate, e.g. home vegetable and animal husbandry versus plantations and livestock agronomy”. I’m thinking “…both and …” NOT “either or …” frames of mind.

      • i7sharp says:

        Sonny,

        http://j.mp/i7w-11
        “Shmita – rhymes with Luisita (the Aquino hacienda)”
        provides a list of articles you may find interesting.

        IMHO, it would take a miracle for PNoy to help initiate implementing shmita even in Luisita alone.
        I am not even sure if PNoy reads the Bible regularly but to understand shmita perhaps he should first know and believe (if he does not already) the three verses I had chosen to include in the homepage of
        http://j.mp/i7weeks

        Trivia:
        As far as I know, in the mid- or late-60s, Hacienda Luisita had two private aircraft:
        a Beechcraft Baron (piloted by Vic Palpalatoc) and a single-engine Cessna (piloted by Rael Salcedo).

        i7sharp

  11. You forgot to mention the hard working Senator Sonny Angara in your citations of creditable public servants.

    • Joe America says:

      I cite him regularly, along with Aquino, because I do think the two represent a good deal of hope that the Senate can peel away from the trapo mentality of putting self interest ahead of national interest. That said, I was extremely disappointed that both signed the Poe Report on Mamasapano, for the flaws and omissions from that document, and the unnecessary blame-casting. In this article, Senator Aquino is cited because he has been emphasizing “buy Philippines” to support Filipino small and middle-sized businesses.

  12. sonny says:

    Joe, if I have not said it, then I say now: BRAVO!! 🙂

  13. i7sharp says:

    Speaking of numbers, …

    P167.86 Billion
    18,400 PPAs
    8,000 pages
    171 cities and municipalities
    in the
    CRRP (Comprehensive Rehabilitation and Recovery Plan)

    Where can one find a online copy of it?

    Salamat.

  14. macspeed says:

    most politician opposing PNOY are CORRUPT!!! Don’t they know they cannot do corruptions in the Future? A lot of these young politicians are now braced with the knowledge that if one steals, he/she will be in jail….simple and powerful…thanks to PNOY and the system that jailed these magnanakaw he he he

  15. JM says:

    A few topics hit me here:
    1. Bandwidth. I work for a telco. It is really hard to cope up with the demand. We keep on buying equipment worth hundreds of millions of $ and it is still not enough. Not to mention that a few years ago, all the networks (including our rival’s) are meant for Voice and SMS and we have just converted most to data. Metro Manila alone is a huge headache. People see no improvement, what they don’t see is that the technology used improved by a large margin. It is just that the number of data users increased as well. Also, dealing with multinationals who have different cultures and accents makes it much more complex. I realized that it is still better to deal with your fellow filipinos. Too bad, we have to hire foreigners and pay $ because Filipino professionals left (to earn $…) because companies in general have some sort of colonial mentality.

    2. Farming. My family have several idle lands located in different provinces (around 30 hectares). Some have been taken by illegal settlers/NPAs. More than half are still ok. The problem is, it is too far from NCR. Upon comparing the income that I can derive from vegetables (400k to 1M gross per hectare per harvest) against what I currently earn, I’m thinking of resigning from work and just manage a farm. I’ll turn it to a mechanized farm as Joe suggested.

    • Joe America says:

      Good luck on your farming.

      I would be sympathetic to the telco plight except that a few years ago, perhaps 2008, PLDT paid dividends to shareholders in an amount equal to the total year’s earnings. The only way I can figure that they did that was by cashing in their depreciation rather than re-investing it to upgrade equipment. A significant portion of their stock is held by foreign interests. I don’t buy any goody two shoes, poor me arguments from them any more.

      That said, I can imagine there are considerable pressures to perform. Globe has upgraded here locally on Bilran Island. It was like, in response to Typhoon Ruby which knocked them down, they took the opportunity to upgrade. I don’t know about Smart. Their signal is much weaker and fluctuates widely in our somewhat remote location.

      I think Globe’s pricing of P1,000 for 5MB per month is ridiculous. Software or anti-virus updates eat that up in a flash. They price computer users out and give away free Facebook to phone users. It’s all rather insane to me.

      • federiko says:

        “I think Globe’s pricing of P1,000 for 5MB per month is ridiculous.” i agree. smart & pldt are of the same rate. should be at least at par with our SEA neighbors. i envy south koreans, hongkongites, singaporeans

        • Joe America says:

          We’ve identified electrical power, and the shortages and expense, as a block to achieving the 6.5% target. Costly internet is another one. I know Senator Aquino is working it it, but it seems to be going south to me.

      • JM says:

        Thanks joe.

        Hmmm… Basic broadband internet here in NCR is at 1099. It is already unlimited at 1Mbps. Before it was 3Mbps per day with a maximum of 7gig, after you use that up it will go down to 1Mbps. The profit margin and the number of phone users is much higher than computer users so there is more investment there. As for your situation in Biliran, I hear some info about provinces here and there but I don’t know much on provincial operations since I don’t handle it. But generally the higher the demand, the better the equipment that we install. I understand your plight joe but the business would normally follow where the money is. Anyway, I’ll ask around to ascertain the reason behind it but odds are those above are the reasons.

  16. RHiro says:

    A very good marketing piece Joe….

    But the oversimplification of GDP rise with qualifying the growth of the economy makes your piece

    mostly snake oil marketing…

    Actually the greatest threat not only here in the Philippines and elsewhere to democracy is not Cayetano or the MILF but the growing inequality and continuing tickle up economics ongoing.

    Below are excerpts from a piece by Emmanuel de Dios from U.P.

    it seems that the ladder of econ. development has been kicked away by historical advances…

    Plus as Piketty has written that capital in the 21st century is all about Finance…

    “In last December’s issue of the Philippine Review of Economics, Jeffrey Williamson and I ask whether the Philippines can still follow the old and well-worn path of the first- and second-tier NIEs. Our answer — after reviewing a series of unfortunate events in recent Philippine economic history — is that it is highly unlikely. With the large and irreversible current-account surpluses piled up by overseas workers’ remittances and the still-increasing revenues from the service-industry BPOs, there is no obvious way to engineer a sustained currency undervaluation the way the Koreans, Taiwanese, and Chinese did. And given the country’s now-higher living standards and enhanced labor protection (relative to, say, some South Asian or African countries), there is little room to compete in the lowest-wage and least-skilled categories (e.g., garments and textiles). Finally technology is also changing, with the appearance of robotics and digital technology (e.g., 3-D printing and customization), making low-cost labor less crucial in production. The latter, spurred on additionally by tax breaks or penalties, has even induced the “on-shoring” of some manufacturing jobs back to the United States.”

    “Turns out we weren’t alone in our worries. A recent paper by the Princeton economist Dani Rodrik (who should probably get the Nobel at some point) documents a global trend showing that the manufacturing surge in developing countries is petering out much earlier than it used to — he calls it “premature deindustrialization” (though my colleague Raul Fabella coined the earlier term “development progeria”). Mr. Rodrik cites technology and globalization as reasons. He suspects that manufacturing technology is now trending towards saving in unskilled and semi-skilled labor and a greater use of skilled labor, the greatest decline being in the use of unskilled labor. The problem, of course, is that manufacturing technology tends to be global in nature, adopted and diffused notably by multinational enterprises and their affiliates. (Which also explains why manufacturing productivity is “converging” globally — another trend found independently by Messrs. Rodrik and Williamson.) Trade liberalization abets this by letting in the trend of cheaper manufactures, turning the terms of trade against the manufacturing industry.”

    • Joe America says:

      “mostly snake oil marketing” as distinguished from econobabble from a guy who has the right to vote but never exercises it because Filipinos fly too far beneath his radar to dignify them with endorsement.

      • R.Hiro says:

        Why is your piece mostly snake oil marketing…You are a fundamentalist believer in trickle down economics as you have expressed…

        When you use numbers to make a point make sure you supply the accurate and correct numbers to make a point.

        Using GDP growth rate in constant terms or in terms after inflation has been factored in is not a measurement barometer to measure the general welfare of the people…

        As they say a rising tide should raise all boats…A more realistic number to produce is the median incomes of households in the country… As per wiki:

        “Median income is the amount that divides the income distribution into two equal groups, half having income above that amount, and half having income below that amount. Mean income (average) is the amount obtained by dividing the total aggregate income of a group by the number of units in that group.”

        This is your personal blog that you publish…During the term of this present administration has median income kept pace with real growth rates or has the opposite happened???

        The economic pie has grown by 30% in real terms during the past 5 years…

        Even the government is hard pressed to gain more revenues in spite of that increase…

        Oh by the way just because I do not vote for President or Vice President does not preclude me from voting for other political positions…

        Trying to isolate me from the ordinary Filipino who I believe have been mis-educated and misled by their leaders by pointing out my alleged hubris is a vain attempt of the ignorant…

        • Joe America says:

          I am a fundamentalist believer in steady work that is not disrupted by obsessions over battlefield deaths or that diverts the nation’s CEO from important work. I used numbers that all you economists appear to shriek about but all the economists in the Philippines do not seem to be able to get the point across that this disruption and instability are THEMSELVES economic events, negative ones. You’all have not stabilized the Philippines. So somehow, if we want to move forward, the snake oil salesman and the economists have to agree on a way to have some impact that generates positive out come.

          Trading insults does not do that, I might add.

          If you want to point me toward one or two metrics that would be useful to orient the Philippine work effort around . . . in the name of stability and progress . . . kindly tell me what is better than GDP.

          • RHiro says:

            Median income measurements of household income and individual median incomes over two to three generations. The Philippine stats office does not have the data on this as the bulk of employment is underground…this would be a clear guide to see if government “policy is working” Feedback is critical

            Basic economic common sense Quality employment incomes generate disposable income that will generate consumption of durables…

            Look what your present day Moses is now saying…Raise wages to levels with higher disposable incomes…

            Because the last surveys says that people are more concerned with rising cost of survival and low wages and poverty…Hence more patronage politics coming our way…

            Fortunately for your present day Moses the left is hard put to articulate this and jumps on any issue to discredit the present day Moses…He is more dense than they are but the left is intent on creating or increasing contradictions..

            http://www.forbes.com/sites/jessecolombo/2014/01/23/why-southeast-asias-economy-is-a-giant-bubble-waiting-to-pop/

            “The Philippines’ M3 money supply, a broad measure of total money and credit in the economy, has more than doubled since 2008, and sharply accelerated in 2013 as interest rates hit new lows:”

            The above article is from that dastardly communist tool Forbes magazine…

            • Joe America says:

              You will have to excuse me for laughing. So you consider my GDP method to be snake oil, even though it is a common comparative among nations, while you recommend using an index for which no data are available, or basic economic common sense, a measure totally without definition or credibility. Do you understand why I laugh? I laugh heartily.

              • RHiro says:

                No data available here in the Philippines…Major advanced economies use median incomes to get a real picture of the quality of GDP growth…this number is used as prima facie evidence of the inequality that has been pervasive for the last 30-40 years….

                https://www.imf.org/external/np/speeches/2014/052714.htm

                “The facts are familiar. Since 1980, the richest 1 percent increased their share of income in 24 out of 26 countries for which we have data.”

                “In the US, the share of income taken home by the top one percent more than doubled since the 1980s, returning to where it was on the eve of the Great Depression. In the UK, France, and Germany, the share of private capital in national income is now back to levels last seen almost a century ago.”

                “The 85 richest people in the world, who could fit into a single London double-decker, control as much wealth as the poorest half of the global population– that is 3.5 billion people.” Christine Lagarde

            • PinoyInEurope says:

              http://www.forbes.com/sites/jessecolombo/2014/01/23/why-southeast-asias-economy-is-a-giant-bubble-waiting-to-pop/

              “The Philippines’ M3 money supply, a broad measure of total money and credit in the economy, has more than doubled since 2008, and sharply accelerated in 2013 as interest rates hit new lows:”

              @RHiro: as an economist, what measures do you propose in terms of risk management to counter this likely risk of a popping bubble? Bubbles can happen, how can we prepare?

              • RHiro says:

                Am not an economist….. We are on a dollar high right now and coming down from that high may be tough on some sectors that will be most affected… Cheap is money is fueling
                the real estate sector and there will hard adjustments that will follow as what happened in 1997….

                Banks and some conglomerates may have a huge adjustment process. San Miguel already started selling off its assets some time back when it got rid of its shares in Meralco as it became over leveraged…. M&A will slow down…

                We still are not seeing substantive FDI’s as investing during a credit bubble period is risky…

                “When things are going well, or you think they are, you tend to relax. And certainly the record high for FDI (foreign direct investment) would seem to indicate that things are going well. But a closer look at the figures would belie this. It would be unwise for the leadership to rest on its laurels because there are thorns in those laurels. And those thorns are reality.”

                “The government’s position is that it’s doing fantastically well, up an impressive 66 percent to $6.2 billion in 2014 from $3.7 billion in 2013. The government attributes the increase to its success at enticing new investment. Well, where are the jobs that investment should have brought in?”

                “The detailed breakdown of FDI is available only up to end-November 2014. And it seems that a reason for the low job creation was that only 27 percent of the $5.7 billion (or $1.5 billion) was actually new investment. And of that, 64 percent (or around $990 million) was in finance and insurance services. Necessary businesses, but they create limited jobs, and don’t add to the production that this country must be in if it’s to be a real part of the world. Only 17 percent (or $268 million, a miniscule amount) was in new manufacturing.”

                “The largest single block of money coming in wasn’t new equity; it was loans, intercompany borrowings—local MNCs borrowing from dad. Now some of that (details aren’t available) will have created jobs through expansion or new activities, but much of it would be just for rehabilitation of aging plants and similar non-job-creating activities.”
                Peter Wallace

  17. RHiro says:

    This is too important not to be shared:

    Manufacturing renaissance?

    Introspective
    Emmanuel S. de Dios
    GOVERNMENT policy has until now implicitly assumed that a good part of inclusive growth can be achieved mainly by promoting manufacturing. This follows from two inferences that are sensible on the face of it. First, beating poverty is indeed about moving people from low- to higher-productivity jobs — and manufacturing is certainly home to some of the economy’s high productivity occupations. Second, the Philippines failed to catch the wave of export-oriented industrialization that lifted many dragon-boats in the 1980s and 1990s, leaving an obvious gap in the country’s industrial structure, where manufacturing is underrepresented for an economy of this size. So surely there is a chance to make up? Perhaps even belatedly replicate the experience of the NIEs?

    Recent trends seem encouraging at first glance. There is renewed interest in the country as an investment destination; manufacturing growth has been robust; and some important foreign investments have entered the country (yes, including that indirectly famous Mitsubishi plant). This has led some quarters to even proclaim a “manufacturing renaissance.”

    But take a slightly longer view of the matter and things look a lot less dramatic. Manufacturing’s share in GDP has barely risen — from 22.2% in 2010 to 23.2% in 2014. On the other hand, the employment share of manufacturing actually stagnated at 8.4% in the last five years, which is even lower than the 10% employment share a decade ago. But what about the high manufacturing growth we hear about? Doesn’t that matter?

    Math is cruel. For the share of manufacturing to grow, it must grow faster than the total itself. So, suppose the economy was growing at 7% and we wanted to raise the output share of manufacturing by just one%age point from 23 to 24% in one year. Manufacturing would then have to grow by almost 12% in that year — which has never happened. Manufacturing value-added grew by an average of only 8% in the last five years, with no sign of accelerating.

    Even crueler algebra applies to employment. Total employment currently grows at 2.8% annually (about a million new workers added per year). To raise its share in employment from by just one%age point — from 8.4 to 9.4% — manufacturing would have to expand employment by 15% a year, i.e., add 5.6 million workers — an absurd proposition, since that would mean shrinking employment in the rest of the economy.

    In last December’s issue of the Philippine Review of Economics, Jeffrey Williamson and I ask whether the Philippines can still follow the old and well-worn path of the first- and second-tier NIEs. Our answer — after reviewing a series of unfortunate events in recent Philippine economic history — is that it is highly unlikely. With the large and irreversible current-account surpluses piled up by overseas workers’ remittances and the still-increasing revenues from the service-industry BPOs, there is no obvious way to engineer a sustained currency undervaluation the way the Koreans, Taiwanese, and Chinese did. And given the country’s now-higher living standards and enhanced labor protection (relative to, say, some South Asian or African countries), there is little room to compete in the lowest-wage and least-skilled categories (e.g., garments and textiles). Finally technology is also changing, with the appearance of robotics and digital technology (e.g., 3-D printing and customization), making low-cost labor less crucial in production. The latter, spurred on additionally by tax breaks or penalties, has even induced the “on-shoring” of some manufacturing jobs back to the United States.

    Turns out we weren’t alone in our worries. A recent paper by the Princeton economist Dani Rodrik (who should probably get the Nobel at some point) documents a global trend showing that the manufacturing surge in developing countries is petering out much earlier than it used to — he calls it “premature deindustrialization” (though my colleague Raul Fabella coined the earlier term “development progeria”). Mr. Rodrik cites technology and globalization as reasons. He suspects that manufacturing technology is now trending towards saving in unskilled and semi-skilled labor and a greater use of skilled labor, the greatest decline being in the use of unskilled labor. The problem, of course, is that manufacturing technology tends to be global in nature, adopted and diffused notably by multinational enterprises and their affiliates. (Which also explains why manufacturing productivity is “converging” globally — another trend found independently by Messrs. Rodrik and Williamson.) Trade liberalization abets this by letting in the trend of cheaper manufactures, turning the terms of trade against the manufacturing industry.

    As a practical matter, however, what this implies is a smaller likelihood that manufacturing will assume the same development importance as it did in the past. Mr. Rodrik predicts that manufacturing shares of output and employment will begin to decline at lower levels of income (around one-third to one half less) than they did before 1990. It will be more difficult for manufacturing output to reach the 30-35% shares that Japan, China, Malaysia, or even Thailand displayed in the 1990s. Today, for example, Indonesia, with a slightly higher income per capita than us, still has a manufacturing share of only 24% of GDP. Brazil and Mexico, both richer than the Philippines, all have shares below 20%. If Mr. Rodrik is right, the share of manufacturing in employment is also likely to peak earlier and well below the 18% China achieved in the 1990s. Indeed rising manufacturing productivity means employment will grow more slowly than output, so that manufacturing’s share in output rises even as its share in employment falls or stagnates, a pattern already found in the Philippines.

    Make no mistake: we should still try to clear obstacles to get as much manufacturing as we can, e.g., improve infrastructure and logistics, cut the red tape, keep labor markets flexible, and at least keep the peso from rising too far. It should be clear, however, that manufacturing itself cannot play the key role in providing the jobs that can lift large numbers of people out of poverty. Numbers simply don’t add up. With new manufacturing jobs increasingly requiring more skills, most poor people will have less and less of a chance to enter them, for the same reason the BPOs don’t make too big a dent on poverty. Rather than burden a sector with unrealistic hopes and inflating it through unwarranted subsidies and other incentives to fulfill those hopes — it is more prudent to spend on the education and training that will allow people to adapt to whichever sector emerges to employ them. Not the Renaissance, which sought to recreate a classical past; rather the Enlightenment, which looked toward the future.

    Emmanuel de Dios is Oscar M. Lopez professor at the UP School of Economics and boardmember of IDEA.

    • Joe America says:

      The point is not that manufacturing has to grow faster than GDP, but that it be added to the mix of productivity to add depth to the economy. The need to focus on education and flexibility has already been registered here in the comments, and, thankfully, in far fewer words.

      • R.Hiro says:

        You obviously missed the point of which economic sector is going to provide the basis for sustainable inclusive growth…

        How does manufacturing get added to the mix of productivity to add depth to the economy?

        You express yourself in articulate well thought out sentences that beguiles understanding…

        Why is the BPO not making a dent on poverty here in the Philippines???

        We have between 17M and 18M households….It would be safe today that 10% of households feel the growth rate…The balance of 90 % do not….

        Joe you are most probably a dollar earner. do you think moving to undervalue the peso would be more helpful to giver you more pesos to spend on????

        Econ development is a hard process…For the Philippines it is like sending a man to the moon…

        Sloganeering is not policy….

        • Joe America says:

          Insults are also not discussion, but you seem to fairly well drip with them. You are the economic wizard, I’ll leave it to you to determine the HOW of economic growth and well-being. My point is directed at the political landscape and the disruptions to good work that are going on now. It is in the simple idea that a Senate absorbed with anguish over 44 of 67 battlefield deaths is not what the Philippines needs right now, nor is having the President resign a year before elections. Now if you believe revolution is the answer and disruption is the way forward, then make that case. If you want to teach me economics, then kindly do it without the dripping insults about what I am trying to accomplish.

        • PinoyInEurope says:

          “We have between 17M and 18M households….It would be safe today that 10% of households feel the growth rate…The balance of 90 % do not….”

          Please give us some sources. I am curious and would like to to some own research.

    • PinoyInEurope says:

      “it is more prudent to spend on the education and training that will allow people to adapt to whichever sector emerges to employ them.” is the main mesage of the article.

      Josephivo has already mentioned this, any other message that I missed?

  18. RHiro says:

    Another basic structural problem is how the State can regain control and manage the elite who actually have captured State power in the Philippines…..

    The state intervention model used by the Asian NIC’s may no longer be available to the Philippines since it would cause a massive issue of creative destruction….Switching from a consumption led economy to one that is investment led would be extremely hard….

    The problem still remaining in the Philippine continues to be the elite’s lack of a sense of country as it has relied on foreign powers as a hedge to their loyalties… That makes an effective State still a pipe dream in the country…

    Heavy State intervention and participation in the economy is a must looking to the future…

    http://www.project-syndicate.org/commentary/labor-saving-technology-by-dani-rodrik-2015-01

    Singapore used massive state participation in the economy to help fund its development….but it first sought to control its elite…

    • Joe America says:

      Now that is a subject worth exploring. I’m not sure what you mean that the elite “have captured State power”. Through political contributions or social and financial favors or what mechanism? Also, what does it mean that the elite “has relied on foreign powers as a hedge to their loyalties”? They seek capital from abroad, or they are investing abroad, or what?

      • R.Hiro says:

        The ratio of government revenues as a % of GDP is between 12-13 …Ah numbers again….

        So government is hard pressed to allocate resources to effect development…You know enforce contracts, rule of law vs the rule of money…

        So in essence the big business conglomerates are free to allocate the resources of the country…

        Productive capacities, land and improvements etc all denominated in financial terms…

        Four families d own the four largest financial institutions wherein 70-80% of the financial assets of the country are deposited.

        Banks operate on the basis of the fractional reserve system anchored by an implicit government guarantee against loss through deposit insurance…Taxpayers are the ultimate guarantors of deposit insurance…

        The value of the peso is maintained by our governments ownership of foreign reserve currencies…

        The International Money architecture is controlled by the U.S.and the rest of the G-7 economies….Due to our colonial history with the U.S. we have constantly leaned on the U.S.controlled Breton Woods (IMF-WB) twins for economic policy and support…Being constantly beset by Balance of Payments problems we have been trying to export our unemployment problems by exporting our surplus labor with great success.

        But still we have not fixed the fundamental structure of a severely imbalanced economy…

        Which families allocates the resources of these banks for all intents and purposes…

        Ayala family, Sy family, Tan family and Ty family…They together with other family conglomerates basically steer the direction of the economy and politics in this country…

        The solutions are there for anyone interested in fixing the problem…

        Simple example…

        When an employee gets employed in the formal economy the employer registers the individual with the BIR for the purposed of his tax obligation…

        But when the same individual opens a bank account the bank does not ask the same individual to fill up a BIR form for withholding tax on interest income…

        American citizens and residents who open a bank account here in the Philippines are required by Philippine banks to sign a form registering them with the U.S. IRS.Otherwise sanctions could be imposed against the same bank…

        Political power whether domestic or foreign is premised on economic wealth.

        To diffuse that monopoly power the State has to step in, if not it becomes a captive State…

        • PinoyInEurope says:

          R. Hiro – look at my posts regarding Turkey and their economic planning.

          Your analyses are very interesting, but do you have any suggestions on what to do?

          Would it be possible for you guys to make suggestions that actually help the government.

          Have you already tried to do so? What were the reactions? Or are you just ivory tower?

          Please learn to summarize a little for the benefit of the laymen here, thank you. 🙂

        • PinoyInEurope says:

          “Ayala family” now what is wrong with having economically powerful families if they invest the money they earn back into the country. The Ayalas are patriotic in that sense, they have developed the country very much, even while earning money why not.

          About the others I do not have that much information, so I cannot make a judgement. If you or others have more information, I would be very happy.

          I gave the example of the oligarch Dogan in Turkey – he is a media mogul with a steel plant among others. Japan was also developed by feudal samurai families like Mitsubishi and Matsushita, the important thing was they were loyal to the country.

        • Joe America says:

          @ R Hiro, I’m still not seeing the solution. The State has to step in by doing what?

          • RHiro says:

            Remove deposit insurance for all private banks… All savings must go directly to government banks or invested in government borrowings…Reinstate the uniform currency law…

            Private banks can source their funds from the equity and bond markets…The lose the money they are answerable to their investors… No more bailouts directly or indirectly.

            Follow the Japanese model for allocating resources to the agri. and industrial sector…

            Japan is considered by many as the only industrial communist country on the planet…

            The State directly and indirectly directs resources to the different strategic sectors of their economy…

            The state’s massive direction of resources on the electronic sector produced together with the U.S. companies the development of the semiconductor industry…

            The subsequent off-shoring of this industry to MALAYSIA. THAILAND, PHILIPPINES, TAIWAN AND CHINA WERE RESPONSIBLE FOR THE RAPID SHIFT OF ARTIFICIAL INTELLIGENCE. THIS HAPPENED IN THE 80’S.

            THE APPLICATION OF THIS REVOLUTIONARY TECHNOLOGY BROUGHT FORTH THE OUTSOURCING INDUSTRY…

            As usual we got the bottom rung of the outsourcing work…Customer contact service..

            The “white collar coolie” sector that everyone is praising… The higher value added work went to India since India pioneered the outsourcing work with major U.S. transnationals..

            Almost all of the elite are in non-tradable sectors of the economy…

            After a complete cadastral survey of the country is done, all possible arable lands are to be brought under control of the State for food production… The Philippines is naturally in the path of numerous typhoon’s and monsoon rains.

            Distribution, collection and water management must be under State control…

            The State must reinsert itself in the utilities business…

            The State must reinsert itself in the building of massive infrastructure…A true PPP system wherein the State is a 49% equity partner…

            • Joe America says:

              Very innovative. Bold. So what do you figure the probability to be that such changes would be introduced? And if that probability is so low as to be almost zero, would you not consider this to be a “snake oil” proposal? For an elixir is only good if you can get the patient to drink it.

              • PinoyInEurope says:

                Duterte would force the patient to drink it. At gunpoint. 🙂

              • RHiro says:

                These are not new as it has been used in China, Switzerland, Germany and once again are being proposed as a cure for the inequality issue in advanced economies…

                The pendulum is starting to move back to the powers of the State…

                The problems in the Eurozone is a prime example…Move towards a political union or destroy the EU….

                They will have to follow the U.S.A. that allows transfer payments from strong to weak states…

                The present sate of affairs in the Philippines is short lived as the “money printing”
                exercise will have to end and the adjustment process will have to start…

                You have to wait for the patient to come down from the cheap money high…..

                Another example is the fact that major U.S. allies are joining China’s sponsored Asian infra bank to the chagrin of the U.S. U.K., France, Germany and Australia are set to join China in setting up a counterpart fund separate from the U.S. dominated IMF-W.B.

                Geo-politics is changing under our very feet as China is achieving its status as a new power……

            • PinoyInEurope says:

              “Distribution, collection and water management must be under State control…”

              Reality in today’s Munich where I live now. Water comes from nature reserves near the Alps, to be precise the Mangfall river dam and is close to Evian and Vittel in purity. The Bavarian State Government successfully opposed French-led EU initiatives to privatize.

              “The State must reinsert itself in the utilities business… ”

              Stadtwerke München is a fully city-owned private firm. It has the MVG public transport company to run the underground, trams, buses (subcontractors for outlying areas, call-by-mobile buses in the so-called “outbacks” of Munich), operates garbage incineration plants with highly modern filters to not pollute, from these it produces hot water for heating and for the municipal swimming pools and saunas I love to go to, it owns the M-Net internet provider company that put fiber-optics to every home within city limits with transmission speeds of over 100 Mbits/s – I haven’t opted for that yet, I don’t need it for now.

              “The State must reinsert itself in the building of massive infrastructure…” Munich’s Franz-Josef Strauss airport is one of Europe’s and the world’s top airports, built by the state-owned Flughafen München GmbH and run by top manager Michael Kerkloh.

              “Japan is considered by many as the only industrial communist country on the planet…” Wrong. Germany too. Especially Bavaria. Detractors say that the Bavarian system is a reformed postwar version of National Socialism and that the Christian Social Union (CSU) ruling party is not black (conservative-Catholic) but black with brown (Nazi) overtones. What I say is that Bavarians are a pragmatic people who do what is just has to be done.

              “After a complete cadastral survey of the country is done, all possible arable lands are to be brought under control of the State for food production…” EU agricultural policy is similar to this, farmlands are private but highly mechanized and subsidized by the EU.

              “The State directly and indirectly directs resources to the different strategic sectors of their economy…” Bavaria started this under postwar Premier Alfons Goppel, his strategies were continued by Franz-Josef Strauss. Siemens was attracted to move from Germany to agricultural Bavaria by preferential deals on buying land and strategic infrastructure. Microsoft has its European HQ near Munich, one of Bill Gate’s former love interests has a high position there. Gate Garching near the computer science institute of Munich university is one of many start-up parks with full infrastructure and coaching.

              A network of technical schools, vocational universities and technical universities was set up in the time of Strauss, including stipends for highly talented students, turning a formerly poor and agricultural state into a high-tech European tiger in two generations.

              Just to show how it CAN be done, not to disparage the Philippines – I know some aspects of this like TESDA, Ayala sponsoring science research in a compound near UP, NSDB scholarships, Philippine Science High Schools all over the country, already exist. I will research on what has already been done in the Philippines in a similar direction and will post it on the webpage that I am creating to highlight progress made in recent years.

              Bavarians are clannish, tribal, drunk, lazy and unruly by nature – but they managed. Meaning to say, this is just an example to show that we Filipinos also can if we want.

              • PinoyInEurope says:

                Hehe, I like the Bavarians.. police over here are very tough and fine those who piss in public- Older Bavarians like to do that practically on every tree after some steins of beer.

                Bawal umihi dito – magbayad ka ng multa! 🙂

    • PinoyInEurope says:

      “Singapore used massive state participation in the economy to help fund its development….but it first sought to control its elite…” see my Turkish examples.

      Suggestion: your analyses are very valuable, but hardly understandable to laymen.

      If you want to reach people, you have to be a bit of a popularizer. My suggestion, please enumerate and outline your arguments. Please make not just comments, but clear suggestions on how to solve problems. Offer Joe a guest blog if you want. Why not?

  19. angie says:

    it’s good to have someone like you that can articulate what’s in our mind.

  20. karl garcia says:

    R Hiro drop by often, PiE needs competition for length of comments.

  21. josephivo says:

    In my world there are 3 levels, first a factual or product level the part of the iceberg that can be seen, secondly a process level that “produces” all this and thirdly an underlying invisible cultural beliefs or mentality level. Most data here reflect the first level, these are easy observable, objectively measurable. Often they can be achieved in several ways such as: “(mass) production lines” or “designer craftsman” – “mechanically” planned and organized or spontaneous and organic growth… The best methods align with the “beliefs” of the practitioners. Changing this third level is most difficult, but also most effective as it has most leverage.

    The best leadership style depends on the situation, mainly the subordinate, their motivation or shared beliefs and their knowledge or skills. The president’s style as a team player and by delegation is effective with able and motivated cabinet. But most Filipinos are at a less knowledgeable level and a large group sees individual progress as more important than national progress so his style is perceived as totally ineffective.

    Comparing successes of companies is difficult even dangerous as the deeper cultural and belief levels might be very different. A country is larger than an organization. Some countries have homogenous cultures others are very diverse, geographically, by social class, by industry…

    The blog discussions are addressing all these fields and that gives a very confusing impression. We should take time to describe the “third level”, what are our strengths (possible different according different groups), what has to change. Kind of deep SWOT analysis. Then we could look at what processes are most suitable to produce more wealth. E.g. Most Filipinos are strong in kindness and helping others leading to tourisms, BPO industry, maintenance…. I have the feeling that similar exercises were done on a cabinet level but that the results were not sexy enough for out tabloid media.

    • Joe America says:

      Very thoughtful piece, josephivo. In this particular article, I am not trying to address the whole of the economy or how to get the 6.5% growth. I am trying to open minds up to how foolish it is to say, on one hand, the President is not doing enough for the poor, and, on the other, why don’t your resign. The best way to d something for the poor is to be stable, not disruptive, and to work diligently for steady and significant growth . . . however it is best done.

      My goal is to say in literary fashion, “ARE YOU’ALL STUPID, OR WHAT, SENATORS, STOPPING WORK SO YOU CAN DISRUPT THE PRESIDENT’S FORTHRIGHT EFFORTS TO GROW THIS ECONOMY!” If I said that, they would only argue and make excuses. But in simple mathematics, the best path forward becomes clear. Stop turning of the engine. Stop throwing wrenches into it. Figure out how to make it work better. DAP is one of the most heavily criticized programs around, and yet its intent was EXACTLY what should happen. Invest in growth, and who gives a rat’s patootie if you call it savings or shavings?

      • PinoyInEurope says:

        “Figure out how to make it work better.” They should be discussing like WE are all discussing now. Santiago, Cayetano and Trillanes should be bringing in Turkish-style economic development ideas, the LP is already doing it modified Singapore style. UNA should bring in Franz-Josef-Strauss style ideas like those I have mentioned here. Discuss and find the best measures to suit the present situation, pragmatically and for the nation.

  22. Ronnie Busaing says:

    Disagree. GDP growth is a bullshit concept only the economists can understand. All Presidents boast of GDP and GNP growths during their terms in office. But Former Presidents Fidel Ramos and Cory Aquino even set up a more REALISTIC barometer to gauge the quality of life in the Philippines which was MANG PANDOY. Of course every Filipino even the mountain dwellers, slum dwellers, laborers and household helps already have cellphones, but they are still living where they are. Lucky for those who became OFWs. In reality, these are the very people who have lifted the Philippines up and put more money in our ECONOMY and corrupt government !!!(Pasensya lang for those who are straight and honest) INSTEAD OF THE OTHER WAY AROUND!!! Condos and townhouses are growing everywhere. Who are the buyers? Ninety percent are OFWs !! The rest are retiring foreigners. Who gets the profit? Foreign investors. How does it profit Filipinos where (27.9%) of the population fell below the poverty line. This data was for the first semester of 2012, an approximate 1 per cent increase since 2009. This figure is a much lower figure as compared to the 33.1% in 1991. In 1985, the absolute number of people living in poverty was 26.5 million. This increased to 30.4 million in 2000 and from 2006 to 2009, increased by almost 970,000 Filipinos from 22.2 million to 23.1 million. Neighboring countries are much better off such as People’s Republic of China (PRC), Thailand, Indonesia (where the poverty level lies at 8.5%) or Vietnam (13.5%).

    • Joe America says:

      @Ronnie, so you would set stability and steady economic growth aside for what exactly? Did MANG PADNOY build expressways, or why is Manila so crowded? Give me an alternative I can understand, because I only grasp the bullshit concept that it takes wealth to help the poor.

      • PinoyInEurope says:

        http://en.wikipedia.org/wiki/Eat_the_Rich_%28book%29

        Eat the Rich is a 1998 book by P. J. O’Rourke which explains economics in a humorous way.

        Its chapters include

        Good Capitalism (United States),

        Bad Capitalism (Albania),

        Good socialism (Sweden),

        Bad socialism (Cuba),

        and an intermission on “Economics 101”, teaching facts that your economics professor didn’t tell you, including the “ten less basic rules of economics”.

        Subsequent chapters are on

        How to make everything out of nothing (Hong Kong),

        How to make nothing out of everything (Tanzania),

        How (or how not) to reform (maybe) an economy (if there is one) (Russia)

        and Eat the rich, the last an encomium to capitalism — “the worst economic system anyone ever invented, except for all the others”,[1][2] a reference to Winston Churchill who described democracy the same way.

        That book shaped my views very strongly.

        • Joe America says:

          O’Rourke is my kinda guy. It would likely take me a month to read this book for all the laughing. I mean, the title alone took me 10 minutes of recovery time.

      • There had been “stability and steady economic growths” according to economists (who knows how or where they get their data) ever since the Martial Law years. This is an overused lingo of every administration. Please pardon me but I could not see its relevance anymore in the international economic scenario. Currency appreciation or depreciation is a more accurate gauge of a country’s economic well-being. It is not that I criticize Pres. Aquino’s accomplishments. In fact I applaud his focus and integrity despite his ever present detractors. What I could not understand is the reason why Poverty Incidence Levels also have a stable and steady growth in the Philippines!! I am not trying hard to be a pessimist but the figures show and I am just being realistic. Same with RHiro’s point, an increased GNP or GDP does not paint the whole picture of the Philippine’s economic health. Even with an additional input on Median Household Income, or Employment Levels, which I’m sure had steadily increased, Mang Pandoy’s kinds are also growing steadily. How come other neighboring countries showed a decrease in their PILs? Having a hard time downloading the Poverty Incidence Map from Wikipedia to this site, but what is clear is the nil incidence of poverty in NCR compared to other regions. The worst incidence are in areas where rebel activities are prevalent. From this picture alone, one can see the inequity in government spending, and maybe the reason why there is no sustainable development.
        Governments are supposed to be the administrators and equalizers of public funds and the taxpayers’ money. (Even Mang Pandoy, without him knowing, is paying the government taxes through VAT). Socialist gov’ts. tax its rich citizens heavily to fund ALL community intfrastructures and projects. Communist gov’ts. own all capital equipments and resources and fund ALL community infras and projects. Democratic gov’ts. tax all citizens to fund ALL community infras and projects. How come the Philippine government which collect all taxes, fund mega infrastructure projects in Metro Manila alone and NCR? Are there no viable projects in the regions?Why? Is there no shortage in housing in Cebu City, Mandaue City or Lapu-lapu City? Is there no need for more roads between Danao City and Carcar City? is there no need to expand the port at Matnog, Sorsogon to accommodate more seacrafts to connect at Allen, Samar? How about more state colleges and universities in the regions? Though our government is identified as a democratic gov’t., it is being run like a COLONIAL GOV’T., with the regions acting as colonies giving tribute taxes without anything in return, just a few road upgrading projects, OVERPRICED International Convention Center and dole out skywalks!! I do not blame our Muslim brothers or even our ethnic tribesmen of Cordillera in behaving the way they did. They just want a comfortable place under the Philippine sun which I believe Is what the rest of the country needs for a SUSTAINABLE stability and steady economic growth. Its imperative, I believe, from among many in the regions, that we pursue a move to DECENTRALIZE, REGIONALIZE, OR FEDERALIZE!!!

        • “It takes wealth to help the poor”. Of course!! Government spending is the crux for a dynamic and responsive economy for all levels. The stark difference in the government spending policies implemented by US President Hoover and Roosevelt during the Great Depression of 1935, which was restrictive on one hand and very liberal on the other, proved that extensive and comprehensive government spending is very necessary for a healthy economy. Most developed countries today have similar economic policies as that of the US. Great Britain uses her scale as the biggest employer in the country and the biggest purchaser of goods, to steer her economy and make it healthy. Even developing nations that have adopted this economic practice like Malaysia through her expanded labor social services program, Thailand with her comprehensive health services, and Italy with her free hospitalization for all citizens, have showed dramatic economic improvements.

        • Joe America says:

          Historically, Philippine GDP growth has not been steady, ranging from 2% to 8%, up and down since 2001. It needs to be sustained over 6% a year for an extended period, I believe, to make any meaningful progress on poverty reduction. The point of the blog was not really economic, though. It was to point out how counter-productive it is to try to destabilize a sitting president while at the same time complaining about poverty. One of the things that impresses me is how hard some of the spending decisions are. Defense or schools, roads or poverty relief, electricity or health care. The wealth has been distributed if you look at 60,000 classrooms about the nation as a part of the distribution, or the provincial roads going in widely across the nation. I’ve looked at the capital investment projects under the Aquino Administration and about half are in the Metro Manila area. (https://joeam.com/2015/01/18/slicing-and-dicing-the-nations-investments-in-itself/ ) I wonder what share of the nation’s GDP is generated from that same area. I’d guess about the same. I can’t find fault with the investments themselves, but I think the pace of project follow-through is too slow for the nation’s pressing needs.

          I look at a drastic change in government as risky, again because of disruption. I’d prefer to see support for continuity and stability and pressing forward, keeping a close eye on what is being done.

          • i appreciate your good intentions and patience in presenting your point Joe. But nobody can help it if they only see faults in whoever sits on the President’s chair especially during times of fare hikes or crisis. It’s been going on for so many Administrations. Almost always, economics is the reason; poverty, that is, because that is what we see everyday. This is the reason for my outlook – (https://www.facebook.com/Agrogene?pnref=lhc). President Aquino is doing fine in his duties as far as I’m concerned. Purging the government of corrupt elected officials and executing appropriate legal actions was already a grand achievement – it ushered in new big investments. Clipping the ears of GOCC CEOs and BODs of their monthly perks and privileges (millions) including lavish employees’ benefits and bonuses was unprecedented This practice had been going on since the Marcos Era. His DAP defense was heroic, for a fund hungry economy that had been starved for the last two Administrations. But, no matter what he does, or any future President will do, I, among others believe that their efforts will not be good enough to please all of the 100 million Filipinos, whether they are the 34 million in NCR, Region III & IV-A who are recipients of 52% of the largest gov;t. projects, or the 66 million in other regions. Governance in the present system is beyond any President’s SPAN OF CONTROL.

            • But I’m sure the multiplier effects of his DAP projects will have a dramatic effect on the economy’s ratings in the years to come, starting today. John Maynard Keynes already computed it.

            • Joe America says:

              Yes, I think that;s true, Ronnie. Still, complacency gets us know where. And stability does. So I will probably repeat that theme from time to time.

    • PinoyInEurope says:

      Condos and townhouses are growing everywhere. Who are the buyers? Ninety percent are OFWs !!

      They might make a difference someday. Enough of them may force politics to change:

      https://joeam.com/2015/02/26/when-will-the-philippines-reach-a-tipping-point/

      • The post tipping point scenario is a bit frightening. The three horsemen you depicted may be the modern Ilustrados of old, but the real battles will be fought and is being fought by the people in the streets and in the mountainsides. Its only a matter of time. Although the government is trying to reinvent itself, some powerful and influencial political dynaties are trying to maintain the status quo. Given the right push for a big change maybe our kinds can bat for a CONTROLLED or PLANNED partition…https://www.facebook.com/Agrogene?pnref=lhc

  23. Ronnie Busaing says:

    Why not FEDERALIZE or REGIONALIZE governance for a start for a more equitable development?

    • Joe America says:

      That is a separate debate from stability and consistency of productive growth. If that is the HOW to get it done, great, there is no conflict between what you are saying and my bullshit ideas.

  24. Bing Garcia says:

    My intention was to help them heal. I wanted to have clear answers should I be asked, “What happened? Why did they die? What will happen to us now?” If my response was “I do not know,” how could I help hasten the healing? Benigno Aquino III

  25. Thank you for you most encouraging words, Sir! I felt you are more Filipino than the majority of us…

    • Joe America says:

      That’s kind of you to say, Harry. I have the luxury of not having a real job so I can think about things, and write a blog, and learn from what people tell me. The main difference is that I decided as a matter of personal principle a few years ago that I would focus on the positive rather than complain. That’s why you will see that most of my more popular pieces strike that chord among others who are also tired of the negativity.

  26. ray james says:

    Ronnie, your key points are correct and the country over time has created an unholy economic gordian knot which is increasingly complex to unravel.
    GDP growth is a distraction to the real underlying issues.

    And federalism is most probably one of the real long term possibilities, but the current level of politics/politicians may only mean greater corruption and less transparency so precluded at this time, nevertheless a key agenda item. The theory may be fine, but in practice it could be a train wreck based on the calamity index of current philippine politics/leaders. Political maturity is a pre-requisite.

    OFW’s still prop up the economy ( without their contribution GDP growth would be roughly halved to circa 3%) maybe that is the calculation which should also be used.
    Poverty incidence has not improved
    Elitism holds the country back
    Income inequality has got worse
    We are falling behind other countries
    GDP growth in isolation means very little, at least to economists, but useful for marketing

    People must be careful with economic data and understand it fully, otherwise ” lies, lies, and damned statistics” ensues, or just partisan marketing material.
    ‘When Bill Gates walks into a bar, the average customer suddenly becomes a millionaire.’

    GDP growth rate needs to be be considered as part of the macroeconomic triangle in conjunction with Poverty Elasticity of Growth (PEG), and GINI index (income distribution) in order to begin to draw any meaningful conclusions.

    PEG – the rate at which GDP growth is translated into poverty reduction levels

    GINI – magnitude of income inequality/distribution

    The fact that The Philippines has the unenviable position as having the worst PEG in Asia, and also a poor Gini world ranking (bottom quartile) suggests that inclusive growth is an impossibility without major changes in economic policies, and that current growth is beneficial for only a very small percentage – mainly oligarchs and US multinationals.

    It also means that little has been done to reduce the poverty trap and hence the key Millenium Development Goals 2015 for The Philippines will be missed ( which may incur a financial penalty for the country by way of reduced grants/aid).
    Conditional cash transfer (CCT) helps to massage the poverty figures but does not alleviate the problem itself, and what was intended as a short term social solution is becoming a long term economic liability. Even at an impossible 9% annual growth rate, poverty would take circa 50 years to essentially eradicate.

    Population growth and life expectancy also figure in the overall long term assessment, – with reductions in one potentially offsetting the other, and creating a long term change in demographics whereby a smaller working population needs to support a larger non working population -, but the key driver and primary objective is always job creation, preferably skilled and well paid, from which nearly all other economic (and most social) benefits are derived. Current levels of unemployment and underemployment are completely unacceptable – all the more so if one trumpets the GDP growth rate. Another indicator of a structural imbalance when all other factors are taken into account.

    Innovation, industrialisation, international co-operation, integrated planning, inequality reduction, import reduction, independence, and intrapreneurship are some of the necessary elements of future growth, particularly as the shape of organisations and nature of work changes – digitisation, urbanisation, and collaboration herald a new era. The Philippines cannot afford to be left behind.

    It must also invest heavily in people through education and training – the % of GDP spent on education has increased but is still well behind other asian countries, suffers from outdated methods, willing but questionable quality of teachers, large class sizes, absenteeism due to child labor practices, and therefore does not augur well for wholesale changes within even the next generation or its ability to compete post ASEAN 2015, beyond supplying low cost labor. A climb up the value chain in all sectors is paramount, and
    adding value through incorporating creativity in new products/services.

    Trend data is also important, as is comparative data to other countries.
    But again progress has been slow particularly in poverty reduction where most ASEAN countries have halved their poverty incidence in the past 10 years whilst it has remained largely static in the Philippines

    The most critical question is what can be done to achieve inclusive growth. Without political will, very little, and the lack of progress in such basic areas as 60/40 provision, monopolies commission, infrastructure investment levels, DICT, whilst the number of OFW’s increase, with a ticking time-bomb of a growing ‘brain drain’ as more qualified people leave for abroad, does not suggest good long term fundamentals.

    Protectionist policies which made sense 50 years ago, and which were only seen as a stop gap en route to opening markets, now work against the country, not only in terms of FDI, but also in making major companies complacent, outdated, and uncompetitive in regional/global markets. There is a dearth of intellectual capital and that represents a country’s future cash flow.

    And any discussion of the economy always needs to bear in mind that 1 trillion pesos of tax free money flows into the shadow economy courtesy of OFW remittances ( equivalent to 100% of national budget – and circa 100,000 pesos per annum tax free per recipient family), whilst up to 1 trillion pesos flows out of the economy as ‘hot money’/illegal money, which is of no benefit to the country since it is either parked or invested overseas to the benefit of other countries. No wonder the philippines has bank secrecy laws stricter than switzerland, and that is designed to protect the few and the corrupt who take but don’t give back. Economic pillaging.

    Foreign Direct Investment remains low due to a raft of reasons, but corruption, legislative inconsistencies, trade protection, and business practices remain barriers, and inflows tend to be short term market speculation rather than for long term tangible projects.

    Deduct the % of the national budget lost to corruption (30 – 40%) and inefficiency (10 – 20%), and the amount of tax not collected, and the one fact is that there is not a lack of money, just a lack of integrity, productivity, creativity, and systems.
    Too much talk, no action, and insignificant initiatives rather than bold integrated strategies. You can’t drain the swamp when you are fighting alligators.

    Bloomberg – “Philippines 25th biggest shadow economy in the world”. Good for consumerism, commodity suppliers, and malls but not for progress, prosperity, or less inequality.

    The first step in problem solving is to gain clarity of the problem and take a holistic view. Focus on facts not perceptions. The general lack of critical analysis and long term planning also partly explains why the country does not achieve more.
    Laissez-faire management and status quo policies combine to put expensive wrapping on a cheap present.

    The 6.5% GDP growth figure begs the questions. Where has the money gone? Why has the opportunity not been maximised? Is the policy to create jobs at home, or just send labor abroad?

    NEDA has a good handle on many aspects but their reports and recommendations rarely get full exposure and discussion. A great waste. The government should publish a simple composite dashboard of key quarterly/annual metrics. What gets measured, and published, gets done. Management by objectives – appraisal by results. Transparency and accountability.
    Enough marketing and mantras.

    Infrastructure investment has averaged only 2.5% of GDP in the past 5 years. It should be double that. It should also be achieving not just a social return on investment but a quantifiable economic RoI geared to generate long term employment and not just short term labor contracts.

    What the country really needs is an economic EDSA, allied to a genuine democratic system.

    What the country cannot accept is treating people as low cost labor units. There is no self-respect for the individual, simply shame on those responsible and accountable for missed opportunities and selling the country short, or stealing the money.

    Economics is more complex than a headline growth rate or a political slogan.
    Economics is also the difference between life and death, dignity or degradation.
    Economics is the science of rational solutions in the hands of irrational politicians.

    Change needs a co-ordinated approach of top down strategies with bottom up implementation, utilising technology not only to educate and train but to distribute work where it is needed.
    A high speed internet can be a better infrastructure investment than a road, or bridge, to nowhere, and high monopoly/duopoly consumer pricing for a patchy service does nothing to help rural communities.

    Innovation is the currency of the future.
    In the new digitised age of which we are only just beginning to scratch the surface of possibilities, there will be new master/servant country dynamics, more disruptive technologies, and fewer winners than losers. The challenge is to be a leader not a laggard. To be in control and not be controlled. To plan long term not react short term.

    “Ideas makes money, money does not create ideas”
    Walt Disney

    But as Keynes said “in the long run we are all dead”, so in the meantime, have more fun in the philippines.

    • Joe America says:

      @ray, “poverty incidence has not improved”, what is your source for that finding? Thanks.

      “income inequality has gotten worse”, yes, in terms of the gap between the very rich and the very poor. The question is, though, how about the large number of people in the middle? It seems that there are a LOT who are doing better.

      “We are falling behind other countries”, well, to the contrary, the Philippines is gaining on just about every global index around. Are some countries doing better? Yes, they are more stable and mature, not like the unstable, immature Philippines. The relentless negativity of your statement astounds me, when Filipinos take real progress by their nation and turn it inside out.

      GDP is a number, useful for setting a goal. If you have a better one, then suggest it. The idea is to express a concept in simple terms that people CAN understand, and use it as the benchmark and motivational tool to direct improvement. What index would you use if not GDP? You say people don’t understand GDP, then you throw in esoterics like PEG and GINI as if that would make it understandable. The idea is speak to the masses, the ordinary people. Not economists. How do you do it?

      I didn’t get any further in your comment than that because I think we are talking about different things. I am talking about very simple concepts of stability and consistency of production and you are schooling us in economics.

      • josephivo says:

        GDP can easily be manipulated, one of the major universities (forgot who) uses total car sales as a more reliable indicator for overall growth of a country. (correlating with GDP in China, lagging in India and Russia)

    • PinoyInEurope says:

      “You can’t drain the swamp when you are fighting alligators.” Right, which is why the fight against corruption was prioritized.

      Your comments are very perceptive. It might actually be more productive for you to offer to write a guest blog to Joe – enumerate these risks, and your suggestions on how to manage them. I’ve done something similar for BBL, it is appearing this Sunday.

      I fully agree that there are a number of risks and a number of things that need to be done given the money that is there now. The picture I would suggest is a lot better than you write. An article to clarify these issues and possible solutions would be very helpful.

    • PinoyInEurope says:

      And any discussion of the economy always needs to bear in mind that 1 trillion pesos of tax free money flows into the shadow economy courtesy of OFW remittances ( equivalent to 100% of national budget – and circa 100,000 pesos per annum tax free per recipient family), whilst up to 1 trillion pesos flows out of the economy as ‘hot money’/illegal money, which is of no benefit to the country since it is either parked or invested overseas to the benefit of other countries. No wonder the philippines has bank secrecy laws stricter than switzerland, and that is designed to protect the few and the corrupt who take but don’t give back. Economic pillaging….

      Deduct the % of the national budget lost to corruption (30 – 40%) and inefficiency (10 – 20%), and the amount of tax not collected, and the one fact is that there is not a lack of money, just a lack of integrity, productivity, creativity, and systems.

      Now these aspects are VERY important. Could you please offer us some sources?

      What in your point of view are the solutions to these problems? What to do?

      We look forward to some enlightenment. More fun in the Society of Honor.

    • PinoyInEurope says:

      “A high speed internet can be a better infrastructure investment ” See my post in Munich.

      “The government should publish a simple composite dashboard of key quarterly/annual metrics.” See my example of the Turkish national goals.

      “In the new digitised age of which we are only just beginning to scratch the surface of possibilities, there will be new master/servant country dynamics, more disruptive technologies, and fewer winners than losers. The challenge is to be a leader not a laggard. To be in control and not be controlled. To plan long term not react short term.” Correct. It is like in professional consulting, I am sure there are many from that business reading here. UP OR OUT is what they say at Accenture. Applies to countries as well. Philippines is on the right track but must keep running, keep improving or be left behind. Others are not standing still. Filipino path of least resistance must be overcome. I know from experience.

    • Thanks for your inputs Ray James. I didn’t have the privilege of encountering PEG and GINI in my previous studies on Adam Smith. Old school. Please take time to view these ideas if they are worth discussing: https://www.facebook.com/Agrogene?pnref=lhc

  27. Benito Kuminoy says:

    I think the OP should watch I-Witness documentaries and Lourd de Veyra’s videos to see the BITTER REALITY of the Philippines, because pessimistic Filipinos like me are more realistic and the best!

    FEDERALIZATION IS THE BEST SOLUTION!

    • Joe America says:

      What does one wish an inveterate pessimist? “Have a bad day?” “To your illness!?”

      Hahaha, no offense intended, but there was an expression from an old television show in America from years back, called “Laugh In”, with the riotous Dan Rowan extolling:

      “May the bird of paradise fly up your nose!”

      Seems to have application here.

      • mindanaoan says:

        hahaha. I watched “Martin and Rowan’s” in black and white back in Iligan in the 80’s.

        About the topic. Good ideas are always good. But in my line of work I meet pies in the sky and wishful thinking every day. I hope to see more ‘actionable’ ideas, and more detailed plans, or it will just be dreams.

  28. sonny says:

    Commercial break 🙂

    Speaking of positives:

    My alma mater, San Beda Coll of Law took 1st, 6th, 7th places 2014 Bar Exams!

    BTW, San Beda also took 1st & 5th places 1967 Bar. The topnotcher went on to author Ombudsman creation provision of 1987 Philippine Constitution 🙂

    • Joe America says:

      Congratulations to you, sonny, for your brilliance by association. It is good to read some uplift here after listening to the grousings of all the economists my article dragged out of the wood like so many ravenous termites gnawing at optimism.

      • PinoyInEurope says:

        The better ones can be like carpenters working on wood.

        🙂

        • karl garcia says:

          Sonny,
          RHiro is also from San Beda…..

        • sonny says:

          Very good to know, Karl. Will add to my list. 🙂

          @ Joe

          Not to forget what FDR said: “… but look at the “enemies” I made.” No offense to our other faithful nterlocutors.

          (continuing on master craftsmen of PiE)

          Some more San Beda law grads of note: Assoc Justice Florenz Regalado (1st place), ex-Sen Rene Saguisag (6th place), Atty Rodolfo Duterte (Mayor, Davao). All under tutelage of venerable Dean Jover Ledesma.

          On craftsmen: We are still some years away from car manufacturing and the manual industries. It is time to expand and train millwrights, up-to-date welders and other crafts.
          🙂

          • PinoyInEurope says:

            In feudal cultures, it is harder to train good vocational people because they are often looked down upon. In the beginning I was shocked to see white-collar people in Germany crawl under the table to plug in something, even in meetings. Won’t happen in Makati.

            The last time I experienced a modern feudal culture was in Turkey. I was of course always in best suits, the ekspert from Almanya as they would say, and the company I worked for even had their driver take me to the airport. After work I enjoyed the common people quarter of Üsküdar on the Asian side of Istanbul or went to the mall nearby. After the last project day, my Turkish colleague, the Indian project manager and me dined close to here:

            • sonny says:

              How grossly neglectful to ignore the “lowly” craftsmen: one needs only think of precision instruments, drydocks, pipelines, etc.

              • Joe America says:

                They don’t ignore them exactly, they employ them so as to refrain from climbing into the kitchen cabinet themselves with a glob of “leak-no-mo” goo. Rather a status thing, or small bit of entitlement.

            • karl garcia says:

              If you are an IT guy in Pinas you roll your sleeves,use your necktie to wipe sweat.just to plug the accidentally unplugged PC of the end user…Those presentations you set up everything and when you are done they ask you to click the remote for them and click the mouse after every powerpoint slide.. That was MY life.

              • sonny says:

                IT incomes should reflect the multiplier/leverage value of the special technical skills in handling of a delicate/vital commodity such as information. Akin to healthcare specialists. And of course law of supply and demand also.

          • Joe America says:

            Thank you for your wise counsel, sonny. I shall write that on a stick-um sheet and paste it on my monitor.

        • sonny says:

          @ PiE

          I hope they become so. 🙂

      • sonny says:

        Joe, your blog has managed to attract big cerebral guns from both sides, a tribute to your highly informed moderating equanimity. Polyannas like me should just sit back and enjoy the fireworks and throw in an occasional sparkler and hope to ease the tension a little bit. 🙂 Among premier law schools, the San Beda legal campus is reputed to being down-to-earth, a virtue I presume. 🙂

  29. PinoyInEurope says:

    Joe, I have decided to collect all links and all facts that show the progress of the Aquino administration and put them on subpage of my own webpage. Register a cheap one-euro domain and have it point there. The trouble is that positive information is not disseminated enough.

    While I consider criticism healthy and additional ideas helpful – like the state doing more to control the flow of economic forces without falling into the planned economy trap, only to avoid market failures that are known to exist and have discredited classical neoliberalism – it is important to know the positive context. It is like climbing up a mountain – don’t always look at the mountain lodge you want to reach, look down at the valley you have left from time to time. Perspective.

    My goal is to help my folks back in the Philippines find the right way, whatever they think it is, as long as it is a right way found by real thinking and not emotion and prejudice. Whether it is more inspired by Turkish-style development, Singapore-style development etc. is the people’s choice.

  30. PinoyInEurope says:

    philippineprogress.de is not yet registered.

    Will let you know when it’s up and running.

    • PinoyInEurope says:

      To the economists on this blog I say – please summarize more and please check whether your theoretical models have to be reviewed to fit rapidly-changing reality.

      Please try to make constructive proposals, and remember that they cannot be done all at once due to political and economic realities.

      But to those who say things cannot be done, I offer this German proverb as food for thought:

      Tue das Nötige und dann das Mögliche, und plötzlich schaffst Du das Unmögliche.

      Do what is Necessary, Then what is Possible, and suddenly you manage to do the Impossible

      • PinoyInEurope says:

        To show both sides equally and have a balanced picture, I shall also register a website called philippineproblems.de – not much need to gather information there. I will only link to GRP, antipinoy, filipinofail, inquirer and other negative media. On philippineprogress.de I will link to Joe America, Raissa Robles, rappler, mindanews and interaksyon among others.

      • NHerrera says:

        PinoyInEurope,

        I read Joe America’s Blog topic up to this point — enjoying the exchanges — and came across your translation of the German Proverb,

        “Do what is Necessary, Then what is Possible, and suddenly you manage to do the Impossible”

        In mathematics there is the item,

        To prove a point, or in doing things correctly and comprehensively, one has to show that the proposal is necessary and sufficient

        In your German proverb, “necessary” is already there; the doing of the the “possible” part, in effect, embodies the sufficient part. That German saying is a practical, layman’s way of saying “doing the necessary and sufficient job.”

        I like that. Thanks.

  31. PinoyInEurope says:

    Pessimists see the dark tunnel. Optimists see the light at its end.

    Realists see both – and already see the next tunnel ahead.

    • PinoyInEurope says:

      Joe, thank you for the link to Noynoys BBL speech.

      I am quoting passages out of it in my blog article tomorrow.

      My risk management is a contribution to the discussion Noynoy seeks.

  32. #BringOurOFWsHome says:

    I rather disagree with the OFW part.

    While I’m not saying that OFW remittances aren’t beneficial to the economy (they are, I’m sure!) The problem I have with this is that we continue to believe that human beings/export labor can still be a continued source of growth for the economy. While I’m sure OFW remittances will remain being substantial to our economy, we should begin with a plan to bring our OFWs home to the Philippines.

    If it is true that, with the continued growth of our economy, salaries will rise, more jobs will be available and (I’m guessing) un/underemployment will decrease, then we should begin investing in getting our OFWs to come back home and create a more beneficial impact by working right here where they belong.

    Economics aside, let’s not forget the difficulties that face the Filipino when we create OFWs: families separated and left behind, mothers and fathers and aunts and uncles working alone in a foreign country, lost in translation and unable to understand the kind of institutional oppression that “forces” people to seek greener pastures thousands of miles away from home.

    The millions of OFWs are one of the many modern-day Filipino heroes and I am not denying their significance in aiding our economy – but it’s time to bring our heroes home where they belong. It’s time for us to rid ourselves of the institutional oppression that creates broken families and OFWs and to create institutions that can help liberate us from the mindset that it’s better to seek work abroad. Bring our OFWs home!

    • Joe America says:

      Thanks for that point of view and I suspect it would be a natural trend should the Philippines continue to demonstrate stability and steady growth.

    • jameboy says:

      While I’m sure OFW remittances will remain being substantial to our economy, we should begin with a plan to bring our OFWs home to the Philippines.
      ========
      Before we plan something anything on OFWs, I think it would be better if we leave them alone right now and instead concentrate on more important and relevant issues that we can do something about. They are suffering, no question, for nobody wants to be alone and far away from their loved ones but it’s part of the sacrifice and their resiliency has enabled them to overcome the hardships. We Filipinos are like that. The separation have repercussions or consequences but the other option is unacceptable. We have been exporting labor since forever and we all agree that OFWs contribution to the country is enormously important. So important that each administration never fails to declare them as modern day heroes. I’m all for that.

      However, planning to bring them back home, while sounds noble, appears to be doing it backward. While the government continues to attract more investors in setting up business climate conducive to investment opportunities the country is not yet in a position to absorb returning OFWs and accord them the kind of employment they are so used to having abroad. If we do that we’re practically sabotaging the effort of the government to realize full economic recovery. We simply cannot do it at this time.

      I’d rather focus, for the next administration, on planning to reduce the population by aggressively promoting population control and continue the economic momentum the Aquino administration has started. For all what has been said about the economy on this article, which I do not object to, I’d rather say that the country is in great shape now because of the “not corrupt” image and perception of the current leadership of the government. PNoy may have some peccadillos as a leader but he doesn’t have the kind of immoral quality his two predecessors were known for.

      With what we have gone through Erap and Gloria, yes, I say, we are really in great shape under this administration.

  33. karl garcia says:

    Mr. Rey James made me research on poverty incidence.
    http://www.pids.gov.ph/index4.php?pr=1044

    “”Govt think-tank debunks Noy claim on lower poverty

    Even the state-owned think tank Philippine Institute for Development Studies (PIDS) branded as inaccurate President Aquinos claim that the poverty level in the country is on a downtrend as it noted the change in the formula used for determining the data.
    In a study, PIDS noted that the Philippine Statistics Authority (PSA), in its official estimated poverty figures for the first half of 2013, reported 24.9 percent of Filipinos were poor in the first semester of 2013 based on the 2013 Annual Poverty Indicator Survey (APIS).
    Aquino had often used the poverty estimate to prove the economic conditions of Filipinos are improving and even attributed the reduction in poverty to the impact of the governments version of the conditional cash transfer program, Pantawid Pamilyang Pilipino Program.
    Even the World Bank, in its August 2014 issue of the Philippine Economic Update, similarly described improving poverty conditions using the data.
    In a policy note that PIDS

    released, its authors argued that while these descriptions of poverty are based on official statistics, the April 2014 press release of the PSA did not actually report a drop in poverty incidence from 2012 to 2013.
    PSA mentioned that 24.9 percent of Filipinos were poor in the first semester of 2013, and that in the same period in 2012, poverty incidence among Filipinos based on the 2012 Family Income and Expenditure Survey (FIES), was recorded at 27.9 percent, PIDS Senior Research Fellow Jose Ramon Albert and co-author Arturo Martinez in Is poverty really decreasing? And if not, Why not?
    But isnt 24.9 percent a decline from 27.9 percent?
    Seemingly, yes, but in this case, no. To compare statistics, their methodologies should be equivalent, Albert explained.
    The PSAs technical notes stated that the source of poverty data on the first half of 2013 is the 2013 Annual Poverty Indicator Survey (APIS), a nationwide sample survey designed to provide information on the different indicators related to poverty and uses a different questionnaire from that of the 2012 FIES.””

    • Joe America says:

      The reliability of data is a problem in many areas, I think, especially when many workers in the Philippines are off the payroll charts. Without question, poverty is severe, as it has been for as long as most of us have been around. The question is, what to do about it. On one hand there are the socialists who would have us take the Ayala wealth and distribute it among the farmers, which would then, as it has in most socialist nations, end capitalist wealth-building and make even more people poor.

      The economy is thin, so the idea that any president can come in and in a year or two cure poverty is lunacy. So the solution is exactly that argued for in this article, steady, stable growth and more of what is being done in the 2015 budget. The choices are so hard, eh?

      DEPARTMENT 2014 2015 % Change
      Education 309.5 367.1 18.6
      Public Works and Highways 219.9 303.2 37.9
      National Defense 123.2 144.5 17.3
      Interior and Local Government 136.2 141.4 3.8
      Health 90.8 108.2 19.2
      Social Welfare and Development 83.4 103.9 24.6
      Agriculture 80.0 89.1 11.4
      Transportation and Communications 48.9 59.5 21.7
      Environment and Natural Resources 23.9 21.5 -10.0
      Science and Technology 13.1 17.8 35.9

      • karl garcia says:

        Yes we already know that poverty won’t go away that easily. Rhiro’s no Bailouts let them fail would be a fine way to make millionaires out of billionaires….Or worse everyone poor if we remove deposit insurance.Nationalize everything.Gosh sir the personnel services wll eat up all the budget next to debt services…oh that parked special deposit wachamacolit would pay up all our debts…..have bsp and monetary board elected…have five six finance the informal economy..and my favorite from RHiro move away from the dollar….That’s ten years of RHito for you.

  34. PinoyInEurope says:

    http://en.wikipedia.org/wiki/Don_Camillo – for those wondering what Joe and me are up to here, this is a beautiful analogy:

    Don Camillo [ˈdɔŋ kaˈmillo] is the main character created by the Italian writer and journalist Giovannino Guareschi (1908–68), and is based on the historical Roman Catholic priest, WW II partisan and detainee of the concentration camps of Dachau and Mauthausen, Don Camillo Valota.[1][2] Don Camillo is one of two protagonists, the other being the communist mayor of the town, known to everyone as Peppone…

    Don Camillo is constantly at odds with the communist mayor, Giuseppe Bottazzi, better known as Peppone (meaning, roughly, Big Joseph) and is also on very close terms with the crucifix in his town church. Through the crucifix he hears the voice of Christ.[3] The Christ in the crucifix often has far greater understanding than Don Camillo of the troubles of the people, and has to constantly but gently reprimand the priest for his impatience.

    What Peppone and Camillo have in common is an interest in the well-being of the town.

    Well Big Joseph is not a communist but an economically liberal American, I am a Pinoy, a former leftist and Catholic who has found back to his faith. So this is how Joe and me often discuss:

  35. ray james says:

    Pie
    Thanks for reminding me of Don Camillo which were my bedtime stories as a child.
    Many a moral in the comedic adventures.
    And Accenture where i worked (in Arthur Andersen days)
    We use to call life at ‘Uncle Arthur’ , ‘like a fish swimming upstream’, but great experience of Governments and Businesses and problem solving. A fast track of learning.

    The advent of ‘big data’ and data analytics has led to a range of dashboard software tools which are not only used as reporting mechanisms in corporations but also extensively in Governments. IBM, SAP, HP, and many specialist firms offer integrated solutions.
    Driven in the main by the development/evolution of Total Quality Management, Best Practices, and Standards such as BS5750/ISO 9000 series, and implemented in Govt departments in many countries, in the move towards open governance, better management, and improved efficiency.
    Strong systems with checks and balances & built in audit reporting also offsets weak institutions and helps to counter corruption.

    The confusion on poverty figures underlines the need for accuracy and a common starting point in areas of economics/business before valid conclusions can be drawn.

    National Statistics Co-ordination Board (NSCB)

    Poverty Gap, and the Severity of Poverty both worsened in 2013/2014

    The Poverty Incidence Level is now 25.8%

    Figures released 6 march 2015

    (self rated poverty is even higher at 29%)

    Shameful figures and a sad indictment of current policies. The Government target by 2015 was 15% !

    • karl garcia says:

      Kindred spirits with PiE, a SAP consultant…..

      • i7sharp says:

        PMFJI.

        I dabbled a bit on SAP during a stint at ARCO which used it.
        That was before the oil company moved to Plano, Texas.

        At that time, JoeAm was working in the vicinity (Pershing Square, LA Public Library, …) at the time? Perhaps?

        For info on barangays, I visit NSCB quite a bit.

        Oops! 9:05am here.
        Time to tune in (on iheartradio) to either Rush Lumbaugh or Dennis Prager.
        They are both on from 9 to 12noon.

    • Joe America says:

      “Shameful figures and a sad indictment of current policies.” Two questions. (1) If you had been president coming into office in 2010, would you have done a DAP program to realign spending? (2) What policies would have been successful at getting to 15%, in your view?

  36. i7sharp says:

    @PinoyInEurope

    FWIW:

    “resurrection” at JoeAm’s:
    1 https://joeam.com/?s=resurrection
    2 https://www.google.com/search?q=site%3Ajoeam.com+resurrection

    Words of Jesus Christ and Dr. Jose Rizal
    1. Noli me tangere – Touch me not (John 20:17)
    2. Consummatum est – It is finished (John 19:30)

    • i7sharp says:

      btw
      The closest I have gone to Munich (where you live?) was Erding
      where I stayed overnight in a friend’s house. About 30 minutes away?
      Many years ago. 🙂

      I will mention of another friend – if only to add something very current:
      Germanwings.
      Yesterday I learned that he (who is from northern Germany) had for some years worked and flown on the very Airbus A320 that crashed the other day.

      Small world.

      • PinoyInEurope says:

        Yes, I live in Munich center. Erding is nice, part of the greater Munich area.

        Germanwings. 😦 – also there was a big blackout in Holland today.

  37. ray james says:

    SAP (Stops All Production) rules the corporate systems world, in conjunction with IBM ( Its Better Manual), but large global implementation projects are a high stakes game, so i will leave it to the young bucks, however great skills to have, very transferable, and marketable.
    Even my German is rusty now, but still a happy shareholder.

    An old SAP joke for pie

    If SAP made toasters…
    The manual to run the toaster would be approximately 10,000 pages long.
    The toaster would come with 2,500 switches which would all have to be set in an exact pattern and in a precise sequence in order to toast specific kinds of bread.
    Each pattern would be established by SAP’s experts as the “Best Practices” method of toasting that kind of bread.
    It would take a team of basis and functional contractors about 1 year to configure the toaster in the best manner, and then another 6 months to test it.
    In the mean time, your entire family would need to attend extensive training classes on how to use the new toaster.
    In order to support end users and consultants, MIT would establish
    a list-serv for people to post questions and answers regarding toaster set-up and operation.
    Of course, the online Help would randomly pop up in German.

    But once it was running, you’d get the best toast in the world!

    • PinoyInEurope says:

      That is true, SAP is a very German system. Thorough, complex and very robust.

      Loved by accounting people and especially controllers for the data it gathers.

  38. payutenyo d agimas says:

    the one thing I like living in the USA is how politicians are always concerned with employment or business.

    the budgets are always geared towards how much employment it generates, whether democrats or republican

    want to eliminate some defense programs? good luck for that

    high unemployment? the next party will win the next elections

    hope to see that kind of politics when I retire and live back in the Philippines

    • Joe America says:

      Welcome to the blog, payutenyo d agimas. One of the initiatives you will see popping up in blogs here is a push to encourage Philippine political parties to think in terms of platforms rather than personalities. For personality laden parties such as NP, I think it is one way to climb out of their ineffectual woods (next Tuesday’s blog).

    • sonny says:

      Me too, payutenyo d agimas. the keen attention to employment & business is so organically alive in American politics.

      Another dynamic is the push in patronage politics to politicize as many employment slots as possible. This push is counteracted by the position holders to protect their positions by the “technical privatization” of procedures especially computerized ones, e.g. hiding shortcuts or special steps to accomplishing tasks or meeting deadlines! It is practically cat & mouse games.

  39. karl garcia says:

    Please allow this very long comment.

    What’s a snake oil?

    http://trabaho.com/html/career/careerart56.html

    R. Hiro on Retail circa 2004
    “In the Philippines, the Philippine Congress denationalized retail trade last year, under pressure from the now-ousted Estrada administration. It is likely that, despite some safeguards in the Retail Trade Liberalization Law, the country is poised to repeat the experience of Thailand and Indonesia

    “This would be tragic since retail is a great absorber of labor. As analyst Rolando Hiro Vaswani points out, with its low barriers to entry, the retail trade sector employs some 11 percent of the work force, or over three million people.

    “Even the World Bank has warned that the retail trade sector is the economy’s safety net,” says Vaswani. “It absorbs rural people being displaced from agriculture and urban workers being displaced by industrial downturns. It is the national shock absorber. You open it up to foreign participation and you will likely see a rise in open unemployment, with all the implications for social stability.”
    Thank God for SM,Rustans,Robinsons,PureGold and sari sari stores….we could have been eaten alive by Walmart,Kmart,Costco,Bloomingdales,Macys
    That could have been tragic. 😦 .Wooh What a Relief!

    ===========================
    R, Hiro on SDA
    http://taga-ilog-news.blogspot.com/2011/07/rp-wasting-30-billion-fund-die-hard-iii.html

    “Several times before, we have written about this idle fund that can free us of foreign dependency right away. We placed the figure at $28 billion or P1.3 trillion and identified that fund as the Special Deposit Account (SDA) with the Bangko Sentral ng Pilipinas (BSP), which was pointed out to us by economist Hiro Vaswani of KME (Kilusang Makabansang Ekonomiya). Recently, we got another confirmation of the existence and availability of this “disposable” fund kept idle only because of the treasonous streak of our BSP officials.

    This is why R Hiro hates GDP so much

    http://hermantiulaurel.blogspot.com/feeds/posts/default?orderby=updated

    “Last week we focused on the incontrovertible fact that the Philippines is fully equipped to achieve success in its national economic recovery aspirations, particularly in the availability of domestic capital, as the idle P1.22-trillion Special Deposit Account managed by the Bangko Sentral ng Pilipinas shows. Hiro Vaswani, forensic finance process consultant and research chief of KME (Kilusan para sa Makabansang Ekonomiya), pointed this out–something that we shared in our last column. Well, Hiro just sent us another e-mail on the subject of competitiveness and the Cha-cha:

    “Maintaining nationalist (partial bars to foreign ownership) provisions in the Constitution in some sectors of the economy and qualified restrictions of land ownership for foreigners is not a bar to economic development. The present 1987 Constitution in many ways calls for a developmental state model that has not been clearly established by the government itself. The calls for changes to the Constitution, in the alleged face of the emergence of a borderless economy, are stupid and insane at best. Firstly, countries do not and cannot compete like corporations. Countries do not have a bottom line that, if not achieved, they die like corporations. Furthermore, the recent financial crisis has already put the lie to the ideas of this so-called borderless world economy led by the more developed economies of the world.

    “Countries all over the world today are putting in place domestic policy measures to grow their domestic economies. Amongst the emerging market economies, strong state developmental policy paradigms are driving their economic development. The problem in the Philippines remains with the policy of importing demand (i.e. export market dependence) deeply imbedded in the Filipino psyche. The economist Simon Kuznets who is credited with the creation of national income accounts (such as GDP or Gross Domestic Product) warned the government then that this measurement does not measure the general welfare of the people in the country. He further warned that there will be a huge disparity in income with developing economies as they transition from agrarian economies… (which) can only be avoided if an industrialization process happens…

    “Figures from the government today reveal that income from deployed foreign employment is greater than domestic employment. The so-called ‘employed,’ consisting of self-employed and unpaid family workers, comprise the bulk of the true unemployed in the country (30 percent to 40 percent).”

    Simply put, competition as an exemplar only emerged from “corporate economics,” along with its myth of the “private sector”-led growth. Of this Vaswani says: “An economic system that depends on individual selfishness and greed without qualifications will always lead to perverse incentives. Lying, cheating and corruption in both public and private sectors become institutionalized. Individual and familial interests prevail over a non-existing national psyche. Economic systems are morally neutral. This is where politics come in. Any student of political economy knows that the material base will greatly influence the political structure. It is in the rational self interest of a poor man to sell his vote for lugaw to survive the day…

    “Economic history has proven that the selfish motive of man to create a better life for himself with ever decreasing levels of effort was directed by men who established state institutions to direct this effort over the last three centuries with resounding success.

    “These state institutions are still mainly national in character. The idea of competitiveness in a borderless economy is a utopian dream of nuts and carpetbaggers. Taking it in hook, line and sinker has created a dystopian situation in the country.”

    So let’s cut the BS and get back to the National Development Economics paradigm. Let’s all junk the GDP mantra and replace it with a National Development Index of human, ecological, industrial and sovereign growth!

    • karl garcia says:

      did three links mybad trapped in spamverse

      • Joe America says:

        No, only spam purgatory, now released . . .

        • sonny says:

          Yikes! Spam is iconic. My childhood comfort food supreme once again desecrated. 🙂 (I found out Hormel invented GI JOE’s nutritional mainstay. Created in the prairies of Winona, Minnesota, my first home state)

          • Joe America says:

            Spam remains highly popular in the Philippines. Indeed, there is now tocino flavored Spam here, and about five or six other specialty flavors. I prefer the original, and we have a case laid away in the event of future Yolandas. Man can live on Spam and rice alone.

            • sonny says:

              You and me both, Joe. The original, yummy. Growing up, spam ranked up there with Magnolia chocolait, Clicquot Club and 6-oz Coca-Cola!

              • Joe America says:

                Some times, some places, the Coke seems to taste better in the Philippines. I don’t know if they didn’t switch to the new flavor or have adjusted it or what. A few years I got some in a six ounce bottle (Mindanao) and it was spectacular. My, how I miss that original flavor.

            • Me too not a case but about a dozen low salt ones for a zombie apocalypse 🙂

            • sonny says:

              @ Joe

              I immediately noticed the difference between Philippine Coke and American Coke when I first tasted the latter in Minnesota.
              I think I have solved the difference in taste: cane sugar in Philippine Coke vs beet sugar in American Coke. Although sucrose is sucrose. Trace organics in cane and beet makes for the taste difference. (My conjecture. Yesss!)

              @ Joe & gianC

              “Without Spam we wouldn’t have been able to feed our army”. — Nikita Khrushchev

              🙂

          • edgar lores says:

            *******
            I must join in on these encomiums to Spam. Huzzah! Huzzah!
            *****

            • sonny says:

              Spam sandwich, (I don’t know if because of or inspite of the original TASTY bread slices), with cold Coca-Cola is nectar & ambrosia in their primal forms. Ay, apo – nag-imbagen!!
              🙂

        • karl garcia says:

          if it is not nuts,capretbaggers,ignorant,delusional,flamboyant wrongness,snakeoil….I just have had it with RHiro .I am no longer a fan(understatement).

          • sonny says:

            Huwag muna, Karl. Anyway you’re on to his position. (BTW, he might be related to the Vaswanis of my generation at San Beda) 🙂

          • Joe America says:

            Yeah. I usually let trolls slide by, because they are one-hitters, visiting, popping off, and leaving. But he is not a troll. He is serious. He reminds me of the big shots in the school yard, strutting around with an attitude, a chip on the shoulder, a need to prove something by pushing others around. An intellectual bully, I suppose. I believe it really IS possible to discuss technical matters with ordinary people who are not economists, and teach rather than condescend. I’m afraid I rather lost it, too.

            • PinoyInEurope says:

              More O’Rourkes, Gladwells and others are need to translate the complex stuff to something simple and applicable. Amaya is the translation of my father’s highly intellectual writings into a medium the masses understand. On German state TV, you have children’s programs that show how factories and trade works in an entertaining way, with comic figures in between to account for attention span. For adults there are evening series explaining economic facts in a summarized way with relevant practical examples.

              I have attempted a break down of the issues discussed by RHiro and others below. Some of the stuff the is mentioning is definitely relevant, except he has ideological blinders on. Which is unfortunate because he and Walden Bello are intellligent and have some points. Few people in the Philippines are pragmatic and not ideological or just stubborn parrots. Others are just jeepney-style pragmatists without structure or vision. A mix is necessary.

              • Joe America says:

                Waldon Bellow was worming his way into my respectful arena, a leftist who can think pragmatically, then he kinda lost it and went banshee over the President’s failure to make speeches that Bello wanted to hear. So after going two steps forward, he went three back, in my book.

              • PinoyInEurope says:

                Walden Bello is often quoted by the Attac and Occupy movements and similar groups, for once a Filipino intellectual who is somebody internationally, a leftist version of Pacquiao. Some of his points are very interesting and some are just ideological.

  40. Arrgh!…i had a lengthy response to RHiro (took a brief break from doing the 43rd of 43 corporate Financial Statements for the BIR ), After saying, Sorry I’m not an economist, just trying very hard to understand, I hit the Post Comment button and the whole message was lost… Word Press what did you do? or what did I do wrong? Awwww…..

    • PinoyInEurope says:

      sometimes comments do get lost, seems to be an intermittent issue in WordPress. I always mark long comments with Ctrl+A, then copy the with Ctrl+C before posting them so that I can always paste them back with Ctrl+V in case they get lost…

      • Anyways, I’ll try to recover from memory, so here goes another try.

        @RHiro

        All those must to do list for the State – If my memory serves me right, some of those “the State must do” have already been tried and what did the citizens demand? Privatize this, privatize that! The State must not compete with private enterprise!

        So if I understand what you are saying – in order for growth to be all inclusive, we must prevent these billionaire businessmen to have total control of the economy (as they are the ones mostly benefiting from the GDP growth, and that this growth is not trickling down to the poorest of the poor)

        So here is my practical mind at work:

        To do that we must enact new laws to implement those, and failing that, we must have a semi-dictatorial government so all these must to do lists could be accomplished asap.

        The reality out there is that our lawmakers can’t or won’t do that as those will adversely affect their benefactors (contributors to their campaign funds) or let’s face it, their own or their families’ business holdings.

        Look at Escudero, by choosing all those businessmen who control our economy as sponsors to his grand wedding, can we expect him to author a bill that will be disadvantageous to his ninongs or sponsors, or even comment against Ongpin’s involvement in inside trading at the stock exchange and the Makati government’s manipulations of the legislation to favor his project (BSP building)

        Unless the government become a benevolent dictatorship to effect all these, we are not very confident that your ideas can come to fruition.

        And what will all those contrary citizens be shouting at the top of their voices? We must have free enterprise. Leave the business to businessmen and the private sectors, leave them alone to do their thing!

        I;m sorry, I’m not an economist, just trying very hard to understand.

        • PinoyInEurope says:

          I wrote some stuff on that below. Three examples of variants on democracy and capitalism:

          Singapore-style: limit freedoms of citizens and allow free-wheeling business.

          Turkish-style: limit freedoms of citizens and control business in a certain direction.

          German-style: citizen freedom but many controls on business so that it helps the people.

          And a lot of mixtures in between. For the Philippines, what mixture is useful and doable?

    • Joe America says:

      I’m not aware that is a common problem, Mary. I don’t use a customized version of Word Press, but an off-the shelf package. It has its limitations but is typically very reliable.

      • PinoyInEurope says:

        The problem statistically only crops up about 1% of the time or less in my experience and could also be a local browser problem in interaction with WordPress.

  41. PinoyInEurope says:

    @Joe: the feudal attitude in the Philippines, disdain of practitioners, entitlement that we talked about above, manifests itself in the attitude of many Philippine intellectuals. They are intellectually extremely good but seem to be PROUD of being divorced from reality. See RHiro.

    To summarize the stuff you and RHiro have been discussing about – it all amounts to HOW much of a role you want the state to have in the economy. There would be two extremes – failed states were you practically don’t have a state and total state control – North Korea.

    ————————————————————————————————————–

    Let me enumerate some things the state may or may not take care of:

    1.a. the state only takes care of lawmaking, justice, safety, taxes, basic infrastructure.
    Possibly even prisons are outsourced, a lot of infrastructure is built via PPP.

    1.b. Social services at a bare minimum like emergency relief, the rest is left to charity. Possibly just social security, health insurance is fully private and not mandatory.

    2.a. the state provides some degree of public education and licenses private schools. The level of support for public education is proportional to how level the playing field is.

    2.b. the state takes care of some or all aspects of social security and health insurance, possibly with publicly licensed companies to take care of the latter like in Germany. Important for a level playing field as well – sudden sickness can ruin the middle class.

    2c. Varying degrees of social services – unemployment insurance, business founder’s subsidies and coaching for jobless people, subsidized housing for the needy, public health services.

    3.a. the state/municipality takes charge of basic utilties (water, electricity, maybe internet) and possibly also some aspects of public transport (railways, trams, subways, MRT, busses). Munich is a case I have mentioned, Switzerland has kept its railways under state control.

    3.b. the state/region/municipality takes care of strategic/major infrastructure projects. Germany’s power grid project to become less dependent on fossil fuels is an example. North-South transmission lines – wind turbines in the North, hydroelectric power in the mountainous South.

    3.c. the state strategically funds higher/technical education to create experts for the future. The highly successful Bavarian strategy of creating vocational universities, centers of excellence in universities and giving competitive stipends to gifted students is a very successful example.

    ————————————————————————————————————–

    Then you have the question of how much the state intervenes in economic matters.

    1.a. Purely regulatory intervention, like some safety and health regulation.

    1.b. Some degree of protection of local industries by customs duties.

    1.c. No foreign ownership of land (Turkey, Philippines), local majority in business (Philippines)

    2.a. Tax breaks for companies that bring jobs in special zones (Philippines)

    2.b. Low and simple tax rates for everybody, business and people (20% in Romania)

    2.c. Tax breaks for local start-up companies in certain strategic areas

    3.a. State-encouraged technoparks or clusters (biotech in Martinsried + Planegg near Munich)

    3.b. Assistance to newly founded businesses via coaching, seed funding, one-stop-shops

    3.c. Real subsidies for growing industries or even partial state ownership (Volkswagen)

    ————————————————————————————————————–

    In my point of view both neoliberals and communists are wrong. Communism is about taking care of everything, neoliberalism is about leaving people by the roadside – the idea that you are responsible for yourself is GOOD, but there are things that are not your fault, like having poor parents (Romanian saying: it’s not your fault if your father is poor, it IS your fault if your father-in-law is) or gettting very sick or losing one’s job due to layoffs and having a big family to feed.

    Free trade is also not 100% possible, total protectionism is bad also. Opening up some industries to competition when they are not ready kills them – it happened during German reunification, East German industries were no match for modern Western German industries and many folded up. Well now you will usually here an East German accent when calling up customer service hotlines – they have a lot of BPO there now. Expecting certain industries to grow by themselves is often not enough, you need to create the right conditions for them to grow – like light and water for plants.

    ————————————————————————————————————–

    Fully agree that the economic base for growth is there in the Philippines. Now the question is, how do you make the most out of it? How do you make sure the growth is lasting?

    Do what is necessary, then do what is possible, and all of a sudden you reach the impossible.

    ————————————————————————————————————–

    Josephivo already identified the main priorities: education and basic nutrition for the poor.

    Joe you identified electricity as a major priority. We are still talking about necessaries here.

    When they have been addressed, do what is possible. The most important things first.

    What you address first depends on where you want to go. That is an important question.

    Reminds me of spring cleaning though – some things you just decide as you go along.

    • PinoyInEurope says:

      Joe you once wrote a very good post about the ideal balance between economic competitiveness and fairness you dream for in the Philippines – it is actually very similar to the ideal society described by Confucius, his saying is at the entrance to NY Chinatown.

      Filipino leaders and especially their think tanks would do well to read some Chinese classics – Confucius for statecraft and administration, Sun Tzu for strategy and war. Learn from those who are doing things right, regardless of whether they are allies or rivals.

      Look at what they did right and what you can use in your specific situation and culture/character. Mix and match. Look at the European classics as well. Macchiavelli for statecraft, Clausewitz for war, Max Weber and others for economics. Check what applies.

      Do not get caught with any ideological blinders – leftist, nationalist, neoliberal. Probably Lenin would have acted totally differently in today’s situation, he might have had an MBA.

      Understand what Rizal already saw long ago – and act as he might have acted TODAY.

    • PinoyInEurope says:

      Eradicating cockroaches, i.e. corruption is also one of the necessary priorities to clean up the kitchen and finally be able to cook properly. Now there are many ways to handle that – starting from the Duterte approach (insecticide) to the present approach which is tedious.

      There are other approaches in between, like emergency powers and Nuremberg-like corruption trials with consequences, and/or laws to ban convicted corruptos from practicing politics for life – if there is a will there’s a way, democracy and rule of law can have variants.

      Totally free-wheeling democracy is too much for people not yet used to handling freedom responsibly. Postcommunist Eastern Europe and the postdictatorial Philippines are examples of that. There are authoritarian democracies like Turkey and Singapore which prove that one does not have to go to dictatorship. Germany also limits democracy in some ways to prevent those who want to destroy it from misusing its possibilities. Time to think here as well, mix and match, find out what is needed and what is applicable and useful.

      • karl garcia says:

        For legislation to proceed the lower house just borrow the transcripts of senate hearing and the condolidated reports…what is the logic of asking the same questions.I hope they pass FOI,anti Anti dynasty………
        Wait how many from the below are now laws got to check later…

        DOF Secretary Cesar Purisima presented the proposed priority legislative measures of the Economic Development Cluster, as follows: (1) Removing investment restrictions in specific laws cited in the Foreign Investment Negative List; (2) Amendments to RA 7718 of the Build-Operate-Transfer Law, as amended; (3) Rationalization of the Mining Fiscal Regime; (4) Transparency and Accountability in Administration of Fiscal Incentives/Fiscal Incentives Rationalization; (5) Amendments to RA 8974 – An Act to Facilitate the Acquisition of Right-of-Way, Site or Location for National Government Infrastructure Projects and for Other Purposes; (6) Amendments to the Cabotage Law; (7) Customs Modernization and Tariff Act (CMTA); (8) Amendments to the BSP Charter; and (9) Further Amendments to the Anti-Money Laundering Act (AMLA).

        DTI Secretary Gregory Domingo proposed to include the following: (a) Amendment to Consumer Act, which aims to incorporate the Lemon Law and update the Consumer Act because of the growing e-commerce, and (b) Competition Law.

        DOTC Secretary Joseph Emilio Abaya also proposed to include the following: (a) Creation of National Transport Safety Board; (b) Strengthening MARINA to be made as single maritime agency in terms of STCW compliance; (c) extending the term of PNR, and; (d) amendment to LRTA charter.

        DSWD Secretary Dinky Soliman and Socioeconomic Planning Secretary Arsenio Balisacan presented the proposed priority legislative measures of the Human Development and Poverty Reduction Cluster (HDPR), i.e., Magna Carta of the Poor and National Land Use Act, respectively. Secretary Soliman also proposed to include the following HDPRC priorities: (1) Marine and Coastal Resources Protection Act; (2) Amendment of the Local Government Code (LGC) of 1991 or RA 7160 re effective implementation of the Universal Health Care Coverage in the grassroots; (3) Coconut Levy Act; (4) Magna Carta of Workers in the Informal Economy Bill; (5) Amendment to Public Employment Service Act of 1999 or RA 8759; (6) An Act to Strengthen the Apprenticeship System.

        DENR Secretary Ramon Paje introduced the proposed priority legislative measures of the Climate Change Adaptation and Mitigation (CCAM) Cluster, namely: (1) Land Administration Reform Act; (2) Energy Efficiency and Conservation Act; (3) Alternative Vehicles Act (Electric Vehicles); (4) Liberalizing the Export of Rice, Corn, and other Grains or Related Agricultural Products, amending Sec. 6 of the National Grains Law; (5) Delineation of Specific Forest Limits of the Public Domain; and (6) Water Sector Reform Act.

        DBM Secretary Florencio Abad presented the proposed priority legislative measures of the Good Governance and Anti-Corruption (GGAC) Cluster, except for the Fiscal Responsibility as this bill was moved to the EDC, namely: (1) Retirement Benefit and Pension Law for Retired Uniformed Personnel; (2) Amendment to Witness Protection; (3) Whistle Blower Protection and Security; (4) Amendment of Ombudsman’s Act; (5) Strengthening Asset Forfeiture; and (6) Freedom of Information. Secretary Abad emphasized the retirement benefit and pension law as the primary priority legislative measure but needs further study in terms of sources of funding.

        The GGAC Cluster, however, has reservation on a salient provision of the proposed amendment to the Ombudsman Act, specifically on the grant of immunity for Ombudsman investigators, complainants and witnesses, as well as the Office of the Ombudsman’s (OMB) 50% share in the proceeds from recovered/forfeited in favor of government. These matters will be discussed or cleared with the OMB.

        DOJ Secretary de Lima raised objection/reservation on the proposed measure strengthening the forfeiture power of the OMB, specifically if the intention of the bill is to grant exclusive power to the Ombudsman as it will divest the Solicitor General of its civil and criminal forfeiture powers. The measure needs further study.

        Lastly, the proposed priority legislative measures of Security, Justice, and Peace (SJP) Cluster were presented by Secretary Cesar Garcia, namely: (1) National Defense Act; (2) Philippine Maritime Zones Act; (3) Archipelagic Sea Lanes Act; (4) An Act Reorganizing & Modernizing the National Bureau of Investigation (NBI); (5) Strategic Trade Management Act; (6) Criminal Code Revision; and (7) Bangsamoro Basic Law.””
        2016 is near finish or not finish come October drop everything and file your candidacy…. 😦

      • Joe America says:

        One of the things I rather like about the Philippines is its quirkiness. Totally free press that abuses the privilege. Wide open elections with people shooting each other left and right. That’s intense engagement in democracy, but it has little to do with patriotism or service. A shell of an economy that is trying to develop a chick inside so it can eventually have a real bird. Political parties that are little more than celebrity fizz, or the son of a loved President who displayed no real qualifications for the job, except pedigree. Then he goes and plays tough guy jailing crooks and running headlong into the buzz saw of complaint and criticism, which, when he makes a mistake, is intense enough to almost sink him. I don’t think there are any comparatives, frankly. Social media is so very very deep, if we include texting. And now there is a rush to smart phones and its all so shallow that its like skating on really thin intellectual ice.

        I love it here. I can write about this place forever . . .

        • PinoyInEurope says:

          My sister calls the Philippines Absurdistan.

          • Joe America says:

            Yes, Kafka would love the place. When it becomes modern and productive and operates with good common sense, it will lose a lot of its charm. It’s allure. It’s intrigue. And I’ll have to retire.

            I figure I’ve got at least 12 years of writing left. Maybe 50 . . .

            • PinoyInEurope says:

              My brother laughed about the Erap impeachment trial, with Santiago getting furious at someone who looked at her from above, the woman who danced when it was decided that an important envelope with evidence would not be opened, the maid whose name was used as a bagman but was not the one who did it, prompting newspapers to make headlines like “will the real Delia Rajas please stand up”. Total corniness.

              Compared with that, the events of the past two months were still very strange, but at least people are beginning to have some streaks of professionalism and seriousness.

              Romania can be crazy as well, liked it in a perverse way, felt a bit like back home.

              • We did not laugh, we were shocked, incredulous, dismayed, flabbergasted, then angry. Angry enough to troop to EDSA once again to unseat another thief masquerading as the highest official of the land. We did not find anything corny.

                We were glued to the TV coverage, we clapped (even my bedridden paralyzed mom clapped her one functioning hand to her thigh) when Clarissa Ocampo testified, we cheered when the cunning and supposedly intelligent defense lawyers were shamed by the other simple witnesses whom they overestimated. We prayed hard for the other witnesses who were then grilled, insulted and baited by the former SC chief Fernando, and the cunning Estelito Mendoza. Oh, yes… Estrada had the brightest defense team, but they were no match for the honesty of the heroic witnesses.

                We were there.

              • PinoyInEurope says:

                Yes, it is easier to laugh when you are far away.

                But it was absurd no matter from where you see it.

              • PinoyInEurope says:

                I didn’t laugh by the way, I was worried. And amazed at the antics of some people. Making a crazy telenovela out of very serious matters.

              • PinoyInEurope says:

                And besides, what was the result of your all going on the streets? Gloria Arroyo. This time people were have been more sensible and not as excitable as 15 years ago.

              • “And besides, what was the result of your all going on the streets? Gloria Arroyo. This time people were have been more sensible and not as excitable as 15 years ago”

                The case of the cunning GMA was a hell lot difficult as she allegedly and systematically destroyed almost all of the government and other institutions, namely the judiciary where she filled all positions with judges questionable ethics, the legislative were just her rubber stamp who stopped every impeachments filed (it was said that her allies would file a weak article on an annual basis to prevent a better one being filed), the church were allegedly bribed to gag them, ditto for the military, and the worst of all, she caused the disillusionment of people to the world acclaimed people power, as she did not prove to be a worthy beneficiary of that phenomenon simply because she clung to power not hers to begin with (the 2004 election).

                Despite all that, we do not regret throwing out Estrada, as he contemptuously and blatantly showed everyone what a President elect should not be doing – his using the position to enrich not only himself and his drinking buddies, but his numerous mistresses and children.

                It is enough that we were successful in throwing 2 despots, and had the church were not that politicized and bribed with cars and funds, as well as the military, we could have succeeded a third time. (Cory, in her weakened state due to cancer, still tried to support that attempt but was disappointed by the non support of the church and military – that was during the time of the Hello Garci scandal.

                The military and the church failed to mature.
                .

    • Joe America says:

      I suppose over the years, I have migrated from idealism to pragmatics, for it does little good to discuss pure solutions when the path to getting to them is impossibly foiled by political, human and practical barriers. It is impossible to use income per household as a statistic because some unknown share of the population has an unknown level of income. I have become gray rather than black or white, and find most black and white patrons to be somehow abrasive for their insistence on their color. Your items 1 through 3c get close to pragmatics, and each sub-point is a detailed discussion in its own right. But my objection was not really the economics, because they can be delivered, but the assumption that anyone who is not an economist is somehow a deficient or manipulative fellow for going against the grain of a purists hard-held ideology which, it turns out, is useless for being so far departed from what can actually be done.

      Why even have the conversation? Better to pray or go biking.

      • PinoyInEurope says:

        It doesn’t make sense to have an ideology. A few major principles to prevent pragmatism from totally drifting into wildness are all that is needed. Ten-commandments style: “thou shalt always promote business, thou shalt always protect the nation, thou shalt always give opportunities to the common people” – and “thou shalt not steal from the nation, thou shalt not covet your neighbours territory, thou shalt not violate thy citizen’s rights”. Simple guidelines and laws adjusted to reality – which is why I like short Constitutions like in USA.

        Like I wrote, the best leaders were at their core pragmatists – Mao would probably be a patriotic taipan today, Lenin would do an MBA before going back to Russia to do Mar Roxas-style work, Rizal would be a political adviser to President Aquino, Bonifacio would be a grassroots-style LGU head, only Mabini would do exactly the same job and be Secretary of Foreign Affairs. That is what doctrinaire intellectuals don’t really get.

        Biking more now. It’s getting warmer. Even if I still have to wear gloves sometimes.

  42. PinoyInEurope says:

    And for thinking, mixing and matching, finding out what is needed and what is applicable and useful, intelligent and modern political parties are need – Joes Tuesday blog is in that direction.

    Parties in modern countries usually represent interest groups and their idea of how things should go. NP is more statist and nationalist, LP more liberal (of course) and business-oriented, UNA pretends to be for the masses. An NP that represents modernized nationalism and state – more like the modern Turkish approach than the confused echos of outdated nationalism and statism, and an UNA that truly represents the masses with an emphasis on social services and helping the poor instead of corrupt populism (Nancy step out of your father’s shadow!) would be vital balances to keep the already modern LP from favoring business too much to the detriment of the state, the nation and the masses. The way both are now, they are irrelevant or harmful in the rapidly modernizing Philippines. Modernization should not be left to one political party alone.

    And academics should get our of their ivory towers and contribute to real national think tanks that feed politics with good ideas – for defence, for national development, for political policy and more. Damn why do blogs like this and internet forums have to do so much of the work for the nation? Once you have this kind of political culture, good journalism will automatically arise as a means of communication between political, academic and economic elites that truly deserve their name.

    • PinoyInEurope says:

      From what I have heard, Trillanes is close to the modern Turkish approach, possibly including elements of the role the armed forces has in that system – and in Thailand. Possibly he is just very quiet about it, his ideas could be too bold for the moment.

      Duterte is also in practice close to the Turkish approach, he took peace and order into his own hands – allegedly – because he had no other choice in Davao, in the Philippines he has already said that he would strengthen AFP and PNP to keep federalism controlled.

      Binay’s emphasis on social services is fake, just pure populism without a true program and of course his alleged corruption is a problem if it destroys business competitiveness by favoring cronies. But the insufficient alleviation of poverty is the card he can play now.

      Mar is good but for my taste not enough state guidance of how the country’s industries are to grow, you need some of that, pure neoliberalism will not bring the Philippines to the next level from being a cost-benefit economy to a competitive one. But he may yet surprise.

      Poe is still in the race, but she is too Poe-kerfaced about what direction she might take. Could be good to the masses if she does not fall into the trap of being nice to corruptos. Could define modern Filipino nationalism without being bad for our international business.

      • karl garcia says:

        I saw this full page paid adcerzisment by retired police and AFP personnel begging for a Lacson Poe tandem…….few years back the taipans even financed the campaign of Lacson,Lacson did not spend much and he lost…maybe he got richer I dunno.

  43. PinoyInEurope says:

    Looking at systems, i have found a model to characterize them quite simply:

    1. How much state authority versus citizen participation do you have? The extremes are dictatorship and mob rule, between them are many shades. Much of the shades in the middle can be called democracy, from authoritarian democracy to liberal democracy.

    2. How much state control/guidance/supervision due you have versus market forces? The extremes are North Korean Juche and neoliberalism. Again many shades in between.

    3. How much central state control do you have versus local control? Total centralism never existed, France comes quite close, the old Philippine datu system was the other extreme. Between the present Philippine state centralism and Swiss-style cantons, many shades again.

    What model is best depends on the culture and temperament of the people, the technical means to project power – computerization allows central states to let go a little to get closer to the people while not losing much control, and the current historical situation that they are in.

    • edgar lores says:

      *******
      Try researching ordoliberalism.
      *****

      • PinoyInEurope says:

        One could try placing all systems that have been defined and exist so far on a matrix.

        The criteria from 1 as the X-axis and the criteria from 2 as the Y-axis.

        • edgar lores says:

          *******
          It’s not that simple. An x-and-y-axis is two-dimensional.

          There are systems, subsystems and meta-systems
          *****

          • PinoyInEurope says:

            For the sake of getting an overview, you have to simplify sometimes. Academics often get lost in all the important but practically often not too relevant details. Consultants use models that simplify, what model you use depends on your goal, then move to details.

            • edgar lores says:

              *******
              You may be oversimplifying, generalizing too much.

              The devil is in the details.
              *****

              • PinoyInEurope says:

                I know – but you have to start somewhere to be able to understand even just a little.

                When I write an article I make an outline first, then drill down to details when I write.

                The ISO model in IT has layers which you define in detail to build complex systems.

              • edgar lores says:

                *******
                Good.
                *****

            • PinoyInEurope says:

              But I get what you mean. Bavaria for example is federal within Germany, but applies French administrative practices and the centralism that goes with them inside.

              But you have to analyse one thing at a time, visualize it, then drill down to details.

              • edgar lores says:

                *******
                As suggested, look into ordoliberalism.

                You will love it. It’s German.
                *****

              • PinoyInEurope says:

                I definitely will. But I might continue on my matrix of economic systems as well.

                With another matrix for political systems. To give orientation.

                Like the Dewey Decimal Classification for libraries.

              • karl garcia says:

                “Ordoliberalism is the German variant between social liberalism and neoliberalism that emphasizes the need for the state to ensure that the free market produces results close to its theoretical potential.[1]

                Ordoliberal ideals (with modifications) drove the creation of the post-World War II German social market economy and its attendant Wirtschaftswunder. However, ordoliberals promoted the concept of the social market economy, and this concept promotes a strong role for the state with respect to the market, which is in many ways different from the ideas that are nowadays connected with the term neoliberalism.[2]

                The term “Ordoliberalism” was coined in 1950 by Hero Moeller, and refers to the academic journal ORDO.[3]

              • PinoyInEurope says:

                Karl, many thanks. This is again a typical German way of doing things – criticize everything, take things apart, and in the end you have something that is not perfect – nothing can be – but highly robust. Not the destructive criticism of GRP, but an engineering and software testing type of criticism that aims to remove major bugs by putting the system through all sorts of stress and performance tests so that it is built to last like SAP.

              • sonny says:

                PiE, remember the deployment of 5 to 10-member teams to all the 1400+ barangays? You replied “to do what exactly” Then I said I have to go back to my drawing board. Does this discussion go along that previous trend of thought? I am following this thread with 5 to 10-member team as systems process specialists, e.g. w/SAP-trained skills, in mind. End-game is:

                START:
                “And for thinking, mixing and matching, finding out what is needed and what is applicable and useful, intelligent and modern political parties are need – Joes Tuesday blog is in that direction.”

                OBJECTIVE:
                “… It oozed so much positive points that I was transported to a place and time that I may or may not be there to experience, ,but hopefully the youth of today will do.” (Mary Grace’s Philippine Eu-topia) 🙂

              • sonny says:

                PiE: “…My model of a modern state would be very similar to the three levels of SAP …”

              • PinoyInEurope says:

                Thanks sonny for putting together things that way from different inputs.

                The thing with the 5-10 man teams is something I would actually do if a leader is there who is willing to back it up and let me assemble an interdisciplinary core team, mixed out of people from different background similar to what we have brainstorming here.

                Core team with maximum 10 people to be able to make decisions and put together a blueprint of what is to be done very quickly and effectively. This core team would then find qualified people from all regions and brief them to form 5-10 man teams for each region. Each person from the national team would also be part of one regional teams to not lose touch in too much abstraction. Regional teams would brief and form the provincial teams, each person in the regional teams would also be in one provincial team. And so on.

                So recursively you have created the 5-10 man teams that go through the barangays, exactly how many of these teams you have per province is a question to be clarified. Standardized data gathering plus comments to be entered via Ipad or similar and integrated real-time into a central server. My guesstimate is that the whole thing can be done in a matter of three to six months and then you have a first preliminary result set.

                Identify and cluster the situations reported the most often, the wishes mentioned as well. Based on that make priorities. Identify the agencies responsible for the top priority items.

                Ask what is already being done, identify gaps and make executive recommendations. This is not going to be an expensive international consultancy study because I would choose international and top-gun national people only for the core team, at the regional and provincial levels talents already there would be involved and enabled. Sonny, many thanks. Additional inputs from you are very welcome. This approach I am proposing is a mixture of international consulting, grassroots work and Maoist democratic centralism. If given priority and support it can be all in all done in one year resulting in an action plan. Even better if the implementation is also supervised by the same team in coordination with the agencies responsible, with feedback and reporting every six months. All very doable.

                Of course I am just an IT consultant, there are bigger calibers than me and I am sure that I would be questioned why him? And it would be a daunting challenge similar to that which Noynoy faced when he became President. But then again, it might be very productive.

                Again, something like that may already be in progress, but then again maybe no. My advantage is my mixture of eclecticism, pragmatism and thoroughness, my energy and my interdisciplinary mentality. Maybe I would need bodyguards though, it might not be safe. Wouldn’t ask for much except full logistics support, what the NATO calls a robust mandate. And enough for me to live on reasonably and safely that’s all. Or maybe I could just be the consultant and the whole thing is lead by a modern and open-minded local leader, better.

              • PinoyInEurope says:

                OK: 17 regions, 81 provinces. So a 9-person core team, 17 regional teams with each of the 9 people one two regional teams to be there, then 81 provincial teams with the regional team people also distribute there. That already makes for three levels.

                There are more than 42 thousand barangays in the Philippines according to Wikipedia. That means provincial teams are responsible for around 500 barangays each.

                It is a daunting task and needs good people at all levels. Make the teams too big and you have a coordination problem. Too many levels and you lose control. So it is probably best if you have provincial teams of around 15-18 people that divide into 2-3 teams that go across the province’s barangays. Makes around 150-200 barangays per team to visit. 3-6 months is too ambitious, it takes about a year of more if you have one week per barangay and then the preparation must also be considered. But it could bring in useful results.

              • PinoyInEurope says:

                At national level, a team composed of a homegrown leader with a strong mandate (not me), a kulit-asar person like me as consigliere who in typical consultant manner asks why three times to get to the heart of the matter (iti apay iti apay iti apay), not necessarily me but I could do it, an international consultant experienced in government matters, Filipino in background, plus reps from all vital organizations in government: DILG, DOJ, DSWD, DOST, NEDA, Education – then you have the nine persons who will be getting things done.

                Supervisory board composed of the President and a few other national leaders to whom we have to report to every three months – to summarize progress and expenditures. Support staff to manage inevitable red tape, admin, IT and other matters.

                Something like a development task force. Doesn’t have to be exactly that way, I don’t know if I even would be the best person to be consigliere but the core suggestion is now here. First draft to be improved upon. Or replaced by a better idea. We are only brainstorming.

              • PinoyInEurope says:

                Regional and provincial teams with similar composition and supervision.

                As soon as provincial teams are up and running, national team people retreat to participate only at regional team level, then when regional teams are OK retreat to national in order to coordinate, analyze and come up with composite results.

                The goals and priorities of the task force should be defined in coordination with the national supervisory board, based on do what is necessary, then what is possible.

              • PinoyInEurope says:

                Six years, one presidential term to do the job. First year to just measure and define, second year to initiate and track the implementation of most urgent measures, by third year provinces manage and track their own measures independently under supervision of national and regional task forces, by fourth year regions work independently under national task force supervision, by fifth year national task force delegates supervision of provincial task forces fully to regional task forces, by sixth year measures full integration of all measures into the day-to-day SOP of all cooperating agencies with inter-agency task forces to be set up at all levels to continue the work started by the development task force.

                By the end of the term, the bicycles would be coasting along. Development task force can be disbanded because it is no longer needed. This approach or something similar might be successful. Or maybe there already is something similar. Karl might find it somewhere.

                First goal I might see as top priority would be to alleviate poverty. Second could be help develop local enterprises so that the masa may gain confidence and rise from victimhood. Third could be to strengthen and focus inter-agency cooperation for common objectives.

              • sonny says:

                (Correction: 1500+ municipalities/cities; 41,995 barangays in the PH) My bad, PiE.

                So far I am trying to constitute the 10-member team. I’m deriving from the implementation of a typical complexity application software. The customer population is 18,000 accounts, a dollar-value portfolio of $3.2 billion (1990 dollar). Admittedly this is a retrofit of a generically defined & designed application and cross-defining to a civil governance application, i.e. the municipality. As a basic unit of governance, the municipal level, the profile fits a potential client to SAPlike environment. Yes? Your thoughts?

              • PinoyInEurope says:

                Municipality is easier, but going down to barangay level makes what you get more real.

                I would not trust the municipality people to tell the truth in all matters, you know how it is, some people have a clean kitchen to show visitors and a dirty one where they really cook.

                OK, you are talking about a governance application, that is something else – it might be doable, something internet or cloudlike with NCSO, Land Titles and other already existing applications as data sources or mirrored, with a web application as the user interface.

                But then again, you would need a unique identifier for every single citizen and national IDs were not introduced in the Philippines, so what would it be, the SSS number like in USA?

                But next thing I know some people in the Philippines will ask is who are you? The get a multinational like Accenture who will ask big dollars but make the government dependent on their services. Locally there are good firms like the one Ramon Magsaysay Jr. owns. They also do SAP and that pretty well. There are good people in the Philippines, but somehow it seems that they are not sufficiently tapped. I might actually be interesting as an adviser and coach to put things together and coordinate efforts while local firms and people get things running, they can but they are often too focused on current issues and don’t really have the time to think of new things, a sort of tunnel vision that ensues…

    • PinoyInEurope says:

      My model of a modern state would be very similar to the three levels of SAP:

      1. Everything related to laws, security and major infrastructure at a central level. All central databases like citizen data, police records, land titles etc. handled at this level. Control over natural resources and their use also.

      2. Everything related to trade promotion, social services and disaster preparedness at a regional level. This would allow for solutions better suited to the level of development and social situation in every region, while still preserving the economies of scale needed. The national level provides a stable base and support in doing this, while the local level provides the interface with the citizen.

      3. Everything related to citizen services and SME promotion at a local level. Here you need one-stop-shops supported by the services that the regional and national levels provide. Keep the barangay as an instrument of minor conflict resolution and basic peacekeeping.

      Subsidiarity without losing central control, closeness to citizens plus economies of scale.

      • PinoyInEurope says:

        Call it federalism or decentralization, I don’t care. In practice what matters is how you balance power and services correctly, with the possibilities of modern IT in mind.

        • PinoyInEurope says:

          Come to think of it, why not apply modern BPO concepts to democracy?

          Have FAQs and handle citizen complaints, queries and suggestions like support calls.

          – Have 1st level support to give people FAQs to read if they ask very ignorant questions.

          – Have 2nd level support for the more difficult questions like those that GRP likes to ask.

          – Have 3rd level support / R&D to deal with the kind of suggestions the come up HERE.

          “Presidential support center may I help you?” “Bakit walang ginagawa si Noynoy?” “Ano po iyon sa palagay ninyo?” “Ewan, basta!” “May e-mail ba kayo?” “Opo” “Sige, ipadadala namin sa inyo ang iilang mga link para mabasa ninyo, saka kayo tumawag ulit”.

          “Presidential support center may I help you?” “What is the government doing for SMEs?” “We will send you the FAQs to that via e-mail, please call us again if you have questions.”

          Charge a small per-minute fee to cover costs and as a source of government revenue.

          • karl garcia says:

            “It’s not that simple. An x-and-y-axis is two-dimensional.

            There are systems, subsystems and meta-systems

            ======================
            “Systems thinking is the process of understanding how things, regarded as systems, influence one another within a whole. In nature, systems thinking examples include ecosystems in which various elements such as air, water, movement, plants, and animals work together to survive or perish. In organizations, systems consist of people, structures, and processes that work together to make an organization “healthy” or “unhealthy”. Systems thinking has roots in the General Systems Theory that was advanced by Ludwig von Bertalanffy in the 1940s and furthered by Ross Ashby in the 1950s. The field was further developed by Jay Forrester and members of the Society for Organizational Learning at MIT which culminated in the popular book The Fifth Discipline by Peter Senge which defined Systems thinking as the capstone for true Organizational learning.[2]

            Systems thinking has been defined as an approach to problem solving, by viewing “problems” as parts of an overall system, rather than reacting to specific part, outcomes or events and potentially contributing to further development of unintended consequences. Systems thinking is not one thing but a set of habits or practices[3] within a framework that is based on the belief that the component parts of a system can best be understood in the context of relationships with each other and with other systems, rather than in isolation. Systems thinking focuses on cyclical rather than linear cause and effect.

            In systems science, it is argued that the only way to fully understand why a problem or element occurs and persists is to understand the parts in relation to the whole.[4] Standing in contrast to Descartes’s scientific reductionism and philosophical analysis, it proposes to view systems in a holistic manner. Consistent with systems philosophy, systems thinking concerns an understanding of a system by examining the linkages and interactions between the elements that compose the entirety of the system.

            Systems science thinking attempts to illustrate how small catalytic events that are separated by distance and time can be the cause of significant changes in complex systems. Acknowledging that an improvement in one area of a system can adversely affect another area of the system, it promotes organizational communication at all levels in order to avoid the silo effect. Systems thinking techniques may be used to study any kind of system — physical, biological, social, scientific, engineered, human, or conceptual.

            • PinoyInEurope says:

              That is a somewhat different model from the simple model I am trying to put together.

              And my point is after all that there are many forms of democracy and free markets.

              Regulating some political matters is not dictatorship.

              Regulating some economic matters is not communism.

              It is all not as black and white as some would think.

  44. i7sharp says:

    “… Systems thinking techniques may be used to study any kind of system — physical, biological, social, scientific, engineered, human, or conceptual.”

    Karl, those *happen* to be seven (7):
    physical, biologocal, …

    Coincidence?
    https://en.wikipedia.org/wiki/The_Magical_Number_Seven,_Plus_or_Minus_Two
    https://en.wikipedia.org/wiki/7_(number)#Religion_and_mythology

    Salamat.

    • karl garcia says:

      “This is just too much of a coincidence to be coincidence. Said by Geoff Chester of the Naval Observatory in Washington, in connection with a boom and flash of light seen over Virginia Sunday night (March 29, 2009) during the same time frame the second stage of the Soyuz rocket launched the prior Thursday was slated to return to Earth.

      • Joe America says:

        I’m sorry, but Mr. Chester obviously Sotto copied that from the great philosopher Yogi Berra who said way back in the late 1900’s: “That’s too coincidental to be a coincidence.”

        Yogi was known for his great insights into the human condition: “In theory, there is no difference between theory and practice. But in practice, there is.”

        Which, obviously, was the entire point of this blog article.

    • sonny says:

      What are you saying, i7sharp? What meanings are you attaching? I would like to hear your insight.

  45. At last, the last corporate reports was emailed to the concerned parties, yey, I’m free of this BIR deadline, next will be the stockholders’ meetings and the reports for them…

    Joe, I have read this article again and the full exchanges of comments just now… OMG… from being uplifted by your blog, I got my eyes crossed and my eyeballs disappeared somewhere up there in my head trying to follow and understand.

    Your message was so simple, direct to the point and so easily understood. It oozed so much positive points that I was transported to a place and time that I may or may not be there to experience, ,but hopefully the youth of today will do.

    Then came the intellectual, though arrogant and insulting commentaries, ugh!

    Democracy is the way to go, although Singapore’s example is not something to be ignored.

    Too much of everything is truly not ideal, such that one maybe tempted to a wishful, unrealistic dream – to hypnotize :

    1) all our lawmakers to enact the laws as presented by the current cabinet members as enumerated by the ever resourceful karl garcia (after ironing out the controversial points, anyway, so a more inclusive growth can be realized,

    2) all our courts, (lowest to highest), to cooperate with these initiatives so the incoming new government in 2016 will have an easier time than this one. Now that one is truly something to look forward to and definitely a lasting legacy to leave behind for the future.

    3) all the tabloid media, (TV, radio and newspapers) to be more patriotic, fair, and be a worthy partner in progress.

    Thank you Joe for another gem of a blog.

    We Filipinos do appreciate your efforts and for myself, I’m humbled by your enthusiasm for this country of ours and somewhat ashamed that you are sometimes a recipient of abrasive, rude and insulting comments for your effort.

    • Joe America says:

      Thank you, Mary Grace. It is amazing, now that you think about it, how my goal of simple, two numbers, to illustrate a simple point, that stability is important, got elaborated into 340 comments and arguments about economic theory, political theory, systems theory and spam.

      But it’s okay. I go to other blogs and assume the role of troll, so I can’t really get too upset if the devil has so many advocates here.

      • PinoyInEurope says:

        Consider yourself a catalyst for many productive arguments – productive for just a few results that have come out of these arguments:

        – numerous links by Karl Garcia and others that prove the governments performance

        – examples from my side to show how other nations are handle things as additional input

        – numerous ideas that may inspire some of us (contributors, readers) to take further action

        In Hollywood they say that it takes a lot of sh.. to produce an orchid. And this evening, all whom I have annoyed by being a smart ass can get back at me. Just like you Joe I am a person who is willing to face the music and loves a good argument – also to learn.

        • PinoyInEurope says:

          expect my BBL article – five pages A4 – by this afternoon RP time. I have finished it now, will print it out and have a look at it when I wake up morning Europe time, not to change anything structurally, just re-read it once more with fresh eyes, correct and submit.

          • Joe America says:

            Very good, I’ll look for it.

            • PinoyInEurope says:

              Sent it now. Looking for more i’s to dot and more t’s to cross makes no more sense after a while.. Looking forward to the interesting discussions on this national issue.

              This time, I will just wait and read the comments and answer in due time, having written my main point. This time I want to learn and find out what other people have to say about the topic. I eagerly but patiently await the publication of the article, thanks again. 🙂

  46. Pauline says:

    Mary grace, you just expressed my thoughts. Let us all unite in making our country move forward! Enough of those naysayers & fault finders, if you cannot contribute positively, step out of the way & let us, movers & visionaries lead & encourage everyone to make this country great as it can be.

  47. PinoyInEurope says:

    Karl, thanks for collecting so much information and posting it here. Good to know that the Aquino government has a lot of highly professional people doing their work well. For me as a skeptic – don’t believe in many things except for God (again, fortunately) and the rest has to be proven – it was important to have proof and not just follower’s statements, given this proof I am convinced. Tomorrows blog about BBL will show that constructive criticism is a loyal and rational thing to do.

    • PinoyInEurope says:

      Really big things only get going if you have VISION and CRITICAL THINKING. Without constant criticism and checking, no major airplane or satellite gets of the ground, no major software products gets running without critical and exhaustive tests and bugfixing.

      Why is the German software product SAP one of the best in the world – not perfect but very robust? Because of the constructively critical attitude within German engineering tradition. Everything is taken apart and questioned before it is finally approved and released. I also thought it was naysaying in my first German industry project which failed because I refused to see the validity of my customer’s arguments. It took me 15 years to learn what it takes – accept that mistakes happen, but do not hide them, analyze them – and learn from them…

      • PinoyInEurope says:

        My way of doing things within software is similar to the way I do things in many aspects of my life including my writings here – I put together stuff that works with what is there, the jeepney-style Pinoy way of working. Makes for very quick results that can be tested. Then I subject the jeepney to extreme quality tests, German-style, and replace the parts that cause major problems with new, better quality stuff, step by step. So you have initial versions that are delivered quickly and within the usually too low budgets and extreme time constraints and are of jeepney quality but work, and two major releases later you have an SUV funded by change requests that are normal in my line of work. Pragmatism in the beginning and thoroughness towards the end is a valid and workable approach.

        Because the typical German approach that plans too long and takes to long to start doing things has its disadvantages, while the Filipino approach that says “puwede na iyan” forever is also not enough. For me, it is “puwede na iyan sa ngayon”, improve later.

        Of like the Germans say: do what is necessary, then what is possible, in the end you manage to achieve the impossible. Like Kidlat Tahimik whose movies I watched as a teen, I wanted to go to the land of Wernher von Braun. And learn to make more than jeepneys.

  48. karl garcia says:

    As Yogi Berra used to say, It aint over til it’s over.

  49. PinoyInEurope says:

    No it ain’t. To summarize some discussions here plus my opinion on things:

    1. The numbers are definitely great. It is something to be very happy about.

    2. But economists are right in pointing out that just relying on OFW and BPO will not be enough.

    3. A national development plan must move the Philippines up to the next level.

    3a. President Aquino is already attracting manufacturing, like the Japanese car plant.

    3b. SMEs are being promoted by Senator Bam Aquino – as a stable sustainable growth base.

    3c. NEDA and the Senate have national development plans already in place among others.

    3d. It is imperative to address the issue of poverty alleviation, as poverty hinders more growth.

    3e. It is imperative to promote the growth of own industries – starting small, going step by step.

    4. My personal opinion is that OFW and BPO revenues will last 8-9 years then decrease.

    5. The next presidential term is therefore the opportunity to create a solid base for the next level.

    Do what is necessary, then what is possible. To finally achieve – the impossible. Philippines can.

  50. karl garcia says:

    Yogi Berra also said if you can’t imitate don’t copy…lastly he said he never actually said what he said.

  51. Bing Garcia says:

    “Well, maybe if you were a young man and saw your father’s murder, and never got to say good bye, and had bullets in your body from when they tried to kill your mother, you might have a point of view or feelings different from most. So why do most people figure the President should see it as they do? Most still have a father and a mother and no bullets in their body. The lack of Christian kindness in this place sometimes stuns me.”

    • NHerrera says:

      Bing Garcia,

      Thanks for sharing that thought. Indeed how can one force his way of thinking on one like our President who had that singular experience.

  52. ray james says:

    Pie

    Structure follows strategy, or strategy follows structure. Both or neither. Chicken and egg. McKinseys or Accenture. A conundrum which keeps consultants gainfully employed!

    The reality is that organisations are in a constant state of dynamic restlessness and that corporate structures have closely mirrored the evolutionary phases of IT development from centralised, to distributed, to networked, to matrix/hybrid, to virtual, to cloud, to mobile, to social and variations in-between.
    Technology either drives, or enables, organisational change, and the associated process re-design. There is a symbiotic relationship between structure and technology. The pace and spread of globalisation correlates to the increased capability of computing and networks and their reduced acquisition & operating costs. In other words expect more.

    The more relevant changes are in the implementation frameworks as consultancies have moved from systems analysis, to business process re-engineering, TQM, and now an integration of Six Sigma and Lean Management. The names and models change – the principles don’t.

    Governments, not surprisingly, still tend to prefer centralised control, and are reluctant to change, but change they must.
    They suffer from a range of problems and constraints including, low IT expenditure/investment, poor quality staff, legacy systems, manual processing, disparate platforms, poor data security and lack of disaster recovery, few standards, and poor customer service.
    An added factor in governments is that different political parties can well have opposing views on structures/data/information access etc.
    Outsourcing IT is the route many Governments ultimately take. An IBM and Accenture speciality – via their Public Sector Innovation business group.

    The major challenge in both private and public organisations is balancing the dimensions of centralised control and decentralised decision making, and separating strategic and operational roles.

    The critical point is to take a systems/holistic approach in order to optimise organisational design and development, and the overall efficiency – and to start the process before it grows into a labor of hercules! Transformational change leaves no stone unturned, if done properly.

    In terms of national progress some of the strategic issues to be addressed

    Primary

    The opportunities for, and barriers to, improved competitiveness, and inclusive growth, in The Philippines, its future outlook within an open ASEAN market, and its role in the global economy.

    (A blue-print and road map for inclusive growth.)

    Secondary

    The impact of globalisation and digitisation on management strategies, structures, and working practices, and its impact on developing economies

    The management of cultures across ‘boundaries’, geographic and generational, and the methods to achieve high performance teams.

    The role of innovation in wealth generation and economic development

    The cause and effect of political dynastic dominance on economic systems and free market dynamics

    The need for new models of organisational structures, and the role of corporate governance & ethics within business.

    The application of technology to drive inclusive growth through education, training, knowledge sharing, collaboration, channels to market, and productivity improvement

    The benefits of a value chain programme for agriculture sector and its contribution to reducing poverty levels in developing economies

    (Practical and prioritised plans and initiatives with cost/benefits, RoI etc.
    Problem identification, solution generation, impact analysis etc)

    Use the German favourite – metaplanning – to generate ideas! It even works in Asia!

    The new ‘industrial age’ will redraw boundaries and rewrite the rules. There is no time for complacency or scope for failure!

    The pursuit of excellence is not a choice, it is a responsibility.

    And remember ‘ don’t mention the war’! – Watch the Fawlty Towers episode on youtube as an antidote to german ‘humour’

    Regards to Mannheim. My next stop – Seoul

    • PinoyInEurope says:

      Metaplanning – just looked it up, it is exactly the technique that I have seen used very often (because my bosses always used it) and suggested in my answers to sonny.

      Obviously you have done more of the real management consulting stuff than I have – I am an implementer who picked up all kinds of techniques along the way to make his own.

      My jeepney-to-SUV approach is what my former boss and me used in the past 3 years to succeed in a major internal BPO project at a very conservative German corporation.

      Against a very suspicious trade union and worker’s council who greeted us with banners on the first day of our workshop with the CFOs right hand man and other characters.

      The working relationship between my former boss and myself being very much like Joe’s and mine – a very rational person to give direction and a kulit-asar person to give ideas.

      I have often been the one to come across Accenture blueprints that I had to implement – I then implemented them in a completely jeepney way, adding my own touch to them.

      One reason we have now succeeded at our common customer was that political enemies probably never thought the jeepney we delivered in the beginning would succeed.

      In fact the two Turkish-German immigrant bosses who now run the internal BPO shop were IMHO also placed in there because they were considered politically expendable.

      We quarreled from time to time – hot southern blood – even in front of the Germans, but covered up for each other on major matters, till we finally had the whole thing working.

      ———————————————————————————————————

      “Outsourcing IT is the route many Governments ultimately take. An IBM and Accenture speciality – via their Public Sector Innovation business group.” Interesting information. Internal outsourcing like what we did for the German corporation is also an approach, especially in conservative organizations that do not like to give away information/power.

      The jeepney-to-SUV or bootstrapping approach with strong enabling of internal people is a low-cost alternative that in the end leaves control of the process with the real owners. The corporation or the government – they of course will have to be willing and able to enable their own people, in the above case it was the trade unions that made sure it was done.

      “The new ‘industrial age’ will redraw boundaries and rewrite the rules. There is no time for complacency or scope for failure! The pursuit of excellence is not a choice, it is a responsibility.” Exactly. We will all wake up in a completely different world.

      ———————————————————————————————————

      Presently I am turning over the German corporation project to new responsibles.

      One of the reasons why I have time to post here, very lucky circumstances.

      My next project this summer is not a jeepney-to-SUV project, it is fixing and modernizing a major project that is a little bit like the MRT in that it is a bit broken. Being a Pinoy, I have the reputation of being able to get anything running, like a backstreet talyer shop. 🙂

      • sonny says:

        “…The jeepney-to-SUV or bootstrapping approach with STRONG ENABLING OF INTERNAL PEOPLE is a low-cost alternative that in the end leaves control of the process with the real owners. The corporation or the government – they of course will have to be willing and able to enable their own people, …”

        I’m still dreaming that our national ills will be remedied into quantum-scale solutions by true and highly motivated Filipinophiles conversant with the power tools & methods available today.

        • sonny says:

          I’m hoping that not a few of our current crop of wunderkind technologists are exposed to reading materials like the IBM JOURNAL OF RESEARCH & DEVELOPMENT and dare dream dreams.

        • PinoyInEurope says:

          It isn’t easy because you need backers with power behind you.

          Otherwise you run into all sorts of glass doors and get hurt.

          But maybe the coming generations have different ideas.

    • josephivo says:

      Is this turning into a consultant platform? 😉

      Spent half my career in management consulting too. First I experienced that setting up new systems was “easy”, implementing more difficult. Then I found out that realizing huge savings in lean and mean, well run organizations was easy and that even minute savings in sloppy old fashion Charles Dickens companies was close to impossible. But it took me 20 years to understand that learning to dream was what many managers needed more than anything else. Having a clear picture in their heart of where to go. But teaching to dream isn’t easy.

      Isn’t this dreaming part of what Joeam is trying to tell us? Help us to see a “first-world” Philippines. Ones sufficient people in leading positions see this deep in their hearts too, the effective and efficient implementation will be a downhill battle. Today the struggle seems still very uphill.

      • PinoyInEurope says:

        Usually the managers who “dream” are those who are up-and-coming and have nothing to lose and everything to gain. The established ones will be careful not to step on feet.

        Management and politics can be very similar in that regard.

  53. ray james says:

    Pie
    You will gain invaluable experience and most importantly a global perspective.
    The secret is to build a large tool kit of techniques and approaches and apply the right one at the right time. Flexibility is key.

    In germany we implemented SAP across 70 countries and 80,000 users. One of the biggest ever. An amazing experience, and lots of airmiles. Fortunately in that project i was only responsible for the global network infrastructure and VPN’s.

    keep moving on, and up!

    • PinoyInEurope says:

      Thanks! 🙂

      So you have certainly been in Walldorf, Germany. I live in Munich which is a bit further away.

      Walldorf (the birthplace of Johann Jakob Astor, a poor German farmboy who migrated to New York City and got rich, the Waldorf-Astoria was founded by his descendants, anyone with the family name Astor who can show he/she was born in Walldorf gets a free night to this day, I happen to know a manager at a SAP partner who availed of that benefit) is to SAP people like the Vatican is to Catholics – the place you have to go to at least once.

      For the readers here, the SAP success story. Founded in 1972 by four programmers who left IBM because there idea of a real-time program was rejected (we have batch jobs to put together data at night, who needs real-time anyway) to continue it as R/1 on their own.

      They rented a building in Mannheim at first and worked on the product for their pilot customer. As soon as they had customers for the matured host application – R/2, they got themselves a building in Walldorf in an industrial area in the middle of asparagus fields and between Turkish migrant junk shops that are still there, between the modern buildings of todays SAP that are connected by skybridges and tunnels. In the 90’s, R/3 was created.

      Originally just an experiment looked down upon with disdain by the R/3 host people, it ported the host architecture of R/2 as a layer on top of the Unix operating system. But all of a sudden R/3 boomed, companies that wanted to get rid of their own host applications or did not have anything yet bought it. SAP built a new HQ building in one of the asparagus fields, soon followed by adjacent buildings that were connected by tunnels, later bridges.

      I got into SAP because of the R/3 NT initiative. I was from a completely different world, doing PC applications, having upgraded from Foxpro to PowerBuilder with NT and Oracle or SQL Server. For small companies, SAP ported the R/3 Unix version down to NT 4.0 and I was one of those who knew NT. Had heard about SAP and wanted in – it was back in 1996. Installed SAP NT machines at several customer sites, created an operating and backup plan for a Swiss printing company, then upgraded again into SAP custom applications.

      From SAP custom applications to application roll-outs – my first project failed marvelously. However, I got to learn the lessons early others had not yet made. More roll-outs that strongly coordinated with business people, including an internal BPO project where I was closely working together with a freelance internal auditor, a former Roland Berger man who plays golf with Joe Ackermann and other top characters. Learned a lot, then burnout, joblessness, drinking, small business promotion money from the unemployment office.

      Freelancing in very unpopular jobs nobody else wanted, including a major refurbishment and overhaul project in Romania which I actually got working against all odds. Better jobs with more business and use case analysis, overhaul and bootstrapping projects, an upgrade or support project here and there. Now I am taking a bit of a break / working less to get myself back into shape, lost 20 kilos last year and my blood pressure is normal from having been 220/150 two years ago, even if I am still on meds things are getting better and I am ready for the next steps whatever they will finally be. Life can take strange directions.

      The moral of the story – SAP and mine – is that success takes time, you have to build a solid base, you have to endure setbacks and nothing is ever wasted, not even the time of Erap and Gloria in the Philippines, valuable lessons are always learned, never give up.

      • PinoyInEurope says:

        Just to add – Noynoy has EARNED my respect because of how he is now getting out of the squeeze he was in recently, just as recent speeches and actions have shown, especially the National Peace Summit he is convening. Please read his speech Joe has mentioned.

        That MAN has been underestimated by many, I now believe what Joe has written about him because I have seen the evidence. Pisay graduates like me need data for conclusions.

        My BBL article tonight and my Rising article on Sunday make references to this theme.

      • sonny says:

        PiE, for my money (it’s small change), the Philippine motherland can potentially be your oyster – as Jobs his Apple and Gates his Microsoft. I daresay too, this Blog’s Holy Grail – a first world Philippines sans the blight of others! There, the gantlet is thrown and the Rubicon is on the horizon. 🙂

        • PinoyInEurope says:

          I really wonder. In 1995 the Philippines was not yet ready, I was there and tried to sell my ideas but it didn’t really work. My father’s cynical comment was baka ayaw lang dahil hindi ka makapaglagay. Seems some things have changed in 20 years from what I am reading.

  54. ray james says:

    Pie
    MBA management dictionary.
    Every technique – too many, but good reference to have
    It is a question of selecting the best over time and through experience.

    http://www.12manage.com/management_dictionary.html

    • PinoyInEurope says:

      Thanks. MBA is something I never managed to do – my GMAT scores were very high, got invitations from Harvard and everywhere but didn’t have the money to shoulder things, my CV was too wild and full of bumps and detours to get a scholarship. But that’s OK.

      Got hired in a company that I still work for now as a regular subcontractor because I told the boss, a native of Hamburg’s red-light district who worked his way up, I never took one single hour of management training, I learned everything by observation and reading and especially by looking at practical examples, he answered good, you are the kind of guy I need, don’t need all these theoreticians, they don’t know what is really useful in practice.

      OK that is a prejudice as well, just like theoreticians who look down upon practitioners. Both approaches are needed, the best teams are interdisciplinary people who know how to speak in tongues yet understand each other, mixing and matching the best approaches.

  55. Kano in Asia says:

    Your positive take on the Philippines is welcome, and the potential path you see toward more widely shared development is basically the one more successful countries have followed. In one area, however, I must take exception: large, mechanized farms. While this is already the case in some major export crops (pineapple, bananas, some sugar), I don’t think it is appropriate for most of the agricultural sector, especially rice, maize, cash crops, etc. The successful economies of Asia were built on radical land reform that redistributed wealth (and ultimately power) supported by technology that enabled small farms to become the most productive in the world. Increasing incomes created a deep and wide demand for consumer goods that further stimulated the industrial economy. Eventually there was large-scale movement out of agriculture, not into slums but into urban and near-urban apartments, or into local townships. Under the conditions prevailing in the Philippines I think it would be disastrous to promote large-scale, mechanized farming. Given the weak tenure laws and unequal power distribution, It would play directly into the hands of the land-based oligopolists. Even without further land ownership redistribution much more could be done to support renting and tenant farmers to transform the rural sector.

    • Joe America says:

      You make a strong argument. If someone were to demonstrate a progressive model of small farm productivity, I might be more convinced. The fundamental business structural model is the cooperative, which the State admits has failed and remains problematic, for the lack of skills, corruption and other failings. Also, land use planning in the Philippines is a local function, and there is very little to stop the eating away of agricultural lands in favor of, not the oligarchs, but people with means who can get the necessary permits. It’s all one big mess to me, as I look across the road and see beautiful terraced rice fields staked off for a huge residential estate. CARP seems to me have knotted land up in misuse, simply sitting vacant or waiting until it can be packaged and sold to the highest bidder.

      Someone needs to put together a model that works. I simply can’t see it. All I see is disorganized mess.

      • PinoyInEurope says:

        In Bavaria there are still a lot of small- and medium-sized farms. EU agricultural policy helped a lot, but also semi-private institutions like Baywa that help farmers with knowledge, information and logistics, many grain silos and distribution are run by them.

        You will have to use google translate on this, no English version (no Bavarian dialect either, just High German which some of these farmers barely can speak but OK):

        http://www.baywa.de

        • Joe America says:

          Well, that idea sparks an interest, keep the small farms, dump the cooperatives, and allow privatized marketing and supply chains to take the place of the cooperatives. That would correct what seems to be a huge shortcoming. Land use would be the other giant piece of the puzzle.

          • PinoyInEurope says:

            Just posted a Wikipedia link. I was surprised, Baywa is far more than just local, it is an agricultural multinational. Well, not surprising, Bavarians being very much like Midwesterners in physical appearance and attitude, born farmers gone global.

            First thing they caught on to when the GIs came after WW2 was country music. Half of the music played at the Oktoberfest is country, “Country Road” is an evergreen there. 🙂

          • PinoyInEurope says:

            Zoning laws have to be strictly implemented. But then again, theory and practice even in Bavaria can differ. A lot of formerly agricultural lands around Munich have now been made into subdivisions to accomodate the population boom that started in the 1990s.

            Without EU subsidies, small farms would hardly survive – but they are also an incentive for farmers to use their land. The reason for the subsidies being EU food autonomy. Maybe josephivo can fill in on this, my knowledge on EU agricultural policy is quite limited.

            • PinoyInEurope says:

              Lot of people moved here and continue to. To paraphrase your article Joe: Berlin is to New York as Munich is to Los Angeles. Wide freeways here connecting former villages that still have their baroque Catholic churches in the town center. Trains to everywhere.

              • i7sharp says:

                What’s the speed limit. if any, in Munich?
                In Los Angeles, 65 is thought by some people as the MINIMUM.

                btw, …
                http://j.mp/i7-beep

                BEEP! BEEP!

              • PinoyInEurope says:

                Theoretically none, practically you know you are in the greater Munich area when you see big electronic signboards above the Autobahn lanes similar to those in LA, with dynamic speed limits based on traffic flow and speed radar in them. Even above the emergency lane there are signboards – they instruct cars to use the emergency lane as a fourth or fifth lane in case of heavy traffic. But let’s say 100 km/h is the minimum for most cars.

              • PinoyInEurope says:

                My record on the freeway to the airport was 210 km/h in a rented Audi. Usually I rent cars when I need them, parking space is hard to come by in town, public transport is good and bike lanes are everywhere so I rarely need one.

                Still had a car rental platinum card then from my old job, went to the car rental in a suit. Showed my platinum card and pointed at the parked Audi. “Do you know who I am?” 🙂

        • PinoyInEurope says:

          http://en.wikipedia.org/wiki/BayWa

          Based in Munich, BayWa Aktiengesellschaft is a German company which operates in the agriculture, building materials and energy sectors. It provides trading, strategic and other miscellaneous services in these sectors.

          The BayWa (Bayerische Warenvermittlung) Group is spread across 14 countries. In Germany and Austria, it operates in all the three core segments of its business and also as a franchisee. The Agriculture segment is further spread via local small scale companies in Belgium, France, Czech Republic, Slovenia, Croatia, Poland, Slovakia, Hungary and Serbia. With respect to its Renewable Energy Resources business, France and Spain are of vital importance. BayWa R.E (Renewable Energy) GmbH operates in these countries through its subsidiaries Renerco Renewable Energy Concepts AG and MHH Solartechnik GmbH. As part of its expansion plan, BayWa is broadening its DIY, garden centres and building materials franchises in Italy and Bosnia and Herzegovina…

          Agriculture

          This is subdivided into three units, Agricultural Trade, Agricultural Equipment and Fruit. The trade unit provides the farmers with an assorted supply of various products which are of importance for the agricultural industry right from the sowing of seeds until harvesting the crops. Besides these products, it also gives guidance and counseling to farmers over issues related to agricultural farming and business. In the Equipments business, BayWa provides a range of machinery, from heavy machines to small sized appliances, to a range of customers including farmers, foresters and the general public. Besides, BayWa also takes contracts for planning and building of agricultural facilities. It also provides service for the entire product range.

          The Agriculture segment makes about 45% of the company’s revenues. The products supplied to the farmers include seeds, fertilizers, pesticides, animal husbandry etc. It also stores and sells the harvest for farmers. In Germany, BayWa has around 500 locations, 16 of them with their own ports, where it provides the services in this segment. As per the 2009 statistics, the revenue of this segment was €3.2 billion.

          Building Materials

          This segment provides products and services for new constructions, renovation work and entire modernization in both rural and urban areas. It also has two sub units, Building Materials and DIY & Garden Centers. BayWa has its sales centers in Germany. It also operates via franchisees in Germany, Austria and Italy. Future plans include entering the market in Bosnia and Herzegovina and Croatia. BayWa is among the largest full line suppliers in this field. This segment forms about 25% of BayWa’s total revenue. Of this, 75% comes from the building materials and only 25% from the garden and DIY unit. There are about 271 locations in Germany and Austria. Around 600 franchised locations are there. Germany is the biggest domestic market. The revenue of this segment was €1.6 billion.

          Energy

          This segment is particularly involved with the sale of heating oil. Besides, other fuels and lubricating oils are also traded. This is the third largest portion of BayWa’s revenue and generates about 25% of the total revenue. The main articles of concern are heating oil, diesel and Otto fuels [clarification needed], lubricants and solid fuel generally as wood pellets. Main sales areas are Bavaria, Baden-Württemberg, the new German federal states and Austria. There are sales offices at several locations. There are about 275 fuel stations owned and operated by BayWa in Germany under the name of BayWa and AVIA. Sales in Austria are done through a group holding GENOL, which supplies fuel to around 500 stations. The major business activities are supplying of local authorities, commerce and mineral oil trade.

          In the renewable energy segment, BayWa bought 3 companies in 2009. The total revenue in the renewable energy field is 228.5 million, and by 2020, the target is to touch 1 billion Euros. In 2009, the revenue of the energy segment was about 1.8 billion Euros.

          Agricultural machines, for example harvesters, are usually rented by small farmers over here for the time they need them, the investment being too expensive for one alone.

      • PinoyInEurope says:

        In East Germany the model is very different. Large estates that belonged to the Prussian landowners (who had tenants whose boys were the cannon fodder for the army while their boys were officers) were collectivized by the Russian military government, the reunification treaty of 1990 forbade all the Junker (landlord) families from reclaiming their land, one of the terms that Gorbachov insisted upon. These estates then became agribusiness farms.

  56. kent says:

    Now is the time that small farmers get together and form a cooperative, and the government should assists with funds so that these farmers can sell directly to the market bypassing the middlemen. These middlemen are usually the ones with capital to purchase farm products at lowest prices.

    • PinoyInEurope says:

      Companies like Baywa were formed in Bavaria, originally state-owned then gradually privatized, in order to take the middleman role in a fairer and more efficient way.

      Middlemen in pre-World War 2 Bavaria were similar to Philippine middlemen, they squeezed the farmers who were mostly very poor then. Many of the middlemen were Jews, one reason why many Bavarian farmers easily succumbed to Hitler’s propaganda.

  57. karl garcia says:

    https://www.senate.gov.ph/…/PB%202013-01%20-%20NaLUA.pdf
    The National Land Use Act

  58. ray james says:

    Pie
    You have an excellent future.
    You shine bright and i suspect have an entrepreneurial spirit.

    I was fortunate to earn my MBA from CASS business school london. ( world top 10 and tough, with strong financial focus being in the city of london – 50% drop out/failure rate) but my professional qualifications are as an accountant and as an auditor before moving into management consultancy, country management, and then global IT director for a well known corporate.

    One of my professors ran 2 MBA courses – one expensive, and one free. He always told us to remember how privileged we are and to give back.

    Having climbed the corporate ladder and passed on the baton, i now invest in start ups, and do ‘pro bono’ work.

    Am also developing a free ‘MBA’ for android/ios so that opportunities are open to all. A variation of TED tutorials and the global university.

    The power and value of knowledge multiplies when it is shared. The power of Collaborative crowdsourcing isn’t really understood in the philippines as a means to move forward. Virtual task forces with planning and ideas generation tools is the way forward. The future of Blogging is Problem solving and creativity. Structured and focussed.
    IBM have great internal tools ( similar are available on the web) and from a list of issues people generate ideas, develop the thread and adopt solutions. 1000’s of threads at any one time. But it takes maturity to work effectively! It originated as part of the cultural and business transformation programme. Now any IBMer can get worlwide help/advice on any topic at any time and is IBM’s big brains working as one superbrain and constantly evolving/improving.

    Principles of BELBIN and team roles/ dynamics. Essential for any project manager.

    More people/budding entrepreneurs should participate in global business games. Great training and a tough challenge. E.g the ones run by BNP Paribas, but also many others. Sorts out the high flyers from the wannabes.

    Best wishes

    keep a work/life balance

    • PinoyInEurope says:

      “The power and value of knowledge multiplies when it is shared. The power of Collaborative crowdsourcing isn’t really understood in the philippines as a means to move forward. Virtual task forces with planning and ideas generation tools is the way forward. The future of Blogging is Problem solving and creativity. Structured and focussed.”

      It isn’t understood because many Filipinos are not really into collective problem-solving yet. Duterte’s grassroots Federalism Forum is one early example of how these things can work. Touring the whole country to talk to local leaders about ways of reforming governance.

      He has the reputation of being a dictator but he only is strict with criminals, when it comes to community work he is a consensus-builder. But then again the Manila and especially the Makati crowd views him with enormous suspicion as he is not one of them, inspite of the fact that he has successfully modernized a former Sin City and is actually very much a fan of rule of law: people who get caught speeding get tickets, even his daughter, even he got caught once and told the surprised cop: write me a ticket, do your job, or else you’re dead. This death squad thing if it is true is probably only the reaction of a lawyer like him who is frustrated with how courts don’t work, his response to a question on extrajudicial killings was once allegedly I don’t kill anyone in court, I am a lawyer I respect courts too much…
      https://fbcdn-sphotos-c-a.akamaihd.net/hphotos-ak-xaf1/v/t1.0-9/10385364_803750606374077_5341922943326441073_n.jpg?oh=be7486a39ab0389202c20f2e55be6f5d&oe=55A1CD44&__gda__=1437375477_14010ede8db465ab9ea64929c1eebcfd

    • PinoyInEurope says:

      “You have an excellent future.” Thanks.

      “You shine bright and i suspect have an entrepreneurial spirit.” True.

      My motto is: whenever I didn’t have any chance, I used it.

      “keep a work/life balance” this blogging thing has been a lot of fun during a lull phase between projects – the end phase of one and the slow start of two others. It was also a good feeling to have helped the country, if only to give ideas for people to think about.

      Before Easter I have stuff to finish though. After Easter a lot of projects start. I will continue to be here but not as often and as much. Similar to my coaching and team-building style – I push people very hard in the beginning, they almost cry, then I let them move themselves and only check from time to time to give advice if needed or corrections if necessary. A lot of my stories here are about: hey I managed to bounce back. Y’all can do it too. 🙂

  59. PinoyInEurope says:

    In fact there are a lot of people in the Philippines working constructively, only they are quiet.
    Duterte is one. Dean Tony la Viña of Ateneo de Cotabato is another. Both from Mindanao.
    Mindanews is one of the best newspapers in the Philippines. Manila newspapers are …

    Local leaders like Governor Salceda of Albay are very participative and constructive.
    KSOs on his Facebook page with regular updates almost monthly on goal achievement.

    So a lot of Filipinos are moving out of victimhood into self-empowerment – my Easter article.

    Hopefully more of them will look at the actual track record of politicians and their programs.
    Personality politics devoid of real thinking what is good for the country should finally end.

    True analysis of current issues should become a habit – which is why I posted the BBL article.

  60. ray james says:

    Joe
    Economics may not be your forte, or interest, but some insights/info for those who want to delve deeper.

    Poverty reduction/inclusive growth.
    Valuable lessons and pointers can be learnt from the strategies, reforms and initiatives employed in neighbouring countries, particularly in the agriculture sectors, some of which could be readily and rapidly adapted to the conditions prevailing in the Philippines. ( the country strategy papers and progress reports are all available on internet)
    Many have succeeded where the Philippines is failing.
    The standard should be excellence, not mediocracy. It should be answers not excuses.

    Poverty levels – % of population
    Philippines 2004 – 23.4% 2014 – 25.8%
    Vietnam 2004 – 42.1% 2014 – 12.0%
    Thailand 2004 – 20.9% 2014 – 11.2%
    Cambodia 2004 – 53.0% 2014 – 20.5%

    Two of the key drivers of inclusive growth are increased innovation and reduced inequality, combined with a clear strategy and implementation plan. It is all about exploiting potential, not exploiting people. About distributing opportunity, not centralising control. And taking an integrated approach, not applying sticking plasters.

    The Philippines sits alongside Uganda and Botswana in the Global Innovations Index (90th) and trails most other ASEAN countries in terms of patents registered and intellectual property, and % of GDP spent on R&D. The lack of Innovation is the philippines single biggest economic weakness and consequently forces it to be too import dependent and unable to grow international companies/products.

    The solutions are varied but well tried and tested elsewhere, but recognising the problem must come first.

    Innovation produces wealth and creates high quality jobs.

    In the US, nearly all net job creation in the economy comes from innovative startups that are less than five years old.

    Innovation is an elusive, and therefore highly prized, commodity.
    It cannot simply be ‘turned on’. It needs careful cultivation through complementary strategies and policies over a long period of time. Innovation is everyone’s business, and the future of business is to be innovators.

    Some of the many components/approaches being used in other ASEAN countries include:

    – Adoption of a Quality Management System ( e.g Baldrige -US model, EFQM – European Foundation for Quality Management, or in the case of Singapore a hybrid of the 2 methodologies)

    – Government assistance for Business Graduates to become entrepreneurs

    – Opening the education market, which even Vietnam is doing, to enable foreign schools to open, and teachers to lecture/teach in key subjects

    – Guest lecturers as means of broadening perspectives

    – Formal links between universities, government and private enterprise to ensure co-ordinated approach

    – 55 million dollar grant from World Bank in one country – Vietnam – ( 2 billion pesos) to run 5 year innovation programme

    – Increased % of GDP to be spent on research & development

    – Intellectual property laws, and patent registration/protection.

    – Innovation Partnership Programme with Innovation leaders ( e.g. Finland, Sweden)

    – Innovation weeks, which showcase innovation domestically and internationally.

    – Base of Pyramid (BoP) ‘incubator’ approach for grass root innovators, and Inclusive Innovation programme for micro-entrpreneurs.

    – Capacity building and global knowledge transfer.

    – Innovation hubs and centers of excellence

    – A focus upon creativity in school curriculum

    – ‘Train the trainers’ in key areas

    – Development of training apps

    – Participation in international Business games

    – closer links between academia and business.

    – apprenticeship schemes

    – free MBA/management courses

    – partnerships with companies as part of their CSP programme ( corporate and social responsibility)

    – use of ‘pro bono’ skills/ voluntary work under ESO ( executive service overseas)

    + maybe 100 more. The ideas are easy to generate. Basic metaplanning.

    Greater inequality dampens the poverty-
    reducing effect of growth which is the current situation in the Philippines. The cycle must be broken which necessitates reducing oligarch power, increasing capital flows, providing greater training and technical support at the grass roots, and utilising low cost technology in creative ways which deliver practical benefits.

    The strategy for, and implementation of smartphone applications in developing countries is just one example.
    From free low cost customised smartphones for all children – education apps and language learning particularly in remote areas, through to medical apps (diagnosis of key diseases), farming apps ( flight of aphids and timely application of pesticides), channel marketing for SME’s, and collaborative problem solving at local level.

    “Give a man a fish and you feed him for a day – teach a man to fish and you feed him for life”

    Datawind, a UK company has developed a low cost tablet for schools/3rd world (equivalent in power to 1st ipad) and is being given to all 220 million indian schoolchildren in India.
    Cost 20 us$ each ( 1,000 pesos)
    Pilots also ongoing in Thailand, Vietnam, Myanmar, Mexico etc…. but not
    Philippines!

    There are a number of grants which the philippines do not make use of. So many missed opportunities there for the asking. It is as though some do not want the poor to develop.

    It’s not rocket science, or marketing, but analysis, economics, and a lot of commitment. Ultimately what counts is not just a good strategy, but a great implementation, and that is determined by the quality of the individuals concerned – the planning, prioritisation, project management, and most of all the political will, particularly in such a centralised and bureaucratic system/structure/culture.

    The pockets of change need to be nurtured and high tech start ups incubated.
    Angel investors abound for the brightest and the best.
    But without a competitive spirit people are always relegated to be voyeurs and followers. Culture is the dominant aspect in change management, and in a class ridden society such as the philippines then self-interest becomes an over-riding factor, and a barrier to diversity, equality, inclusion, and meritocracy.

    Population. Growth rate is 1.9% (2014) with projection of 170 – 200 million population by 2050 – UN.
    I jan 2015

    Time is not on the Philippines side. Too much has already been wasted.
    The pressures and prospect of virtually doubling the current population are simply horrendous, except for the oligarchs, property developers, mall owners, and human traffickers. 35 years, at the pace the philippines works will soon be here and no point in playing dumb or blaming others when more traffic jams occur, productivity falls, social unrest increases, and basic services fail. Time to start working on long term solutions yesterday.

    It essentially equates to needing to create between 1.5 and 2 million new jobs every year for ever! ( less those leaving the workforce, but the skills fit is also important and currently a mismatch). The task is daunting and OFW’s and BPO’s will not continue to absorb those numbers, and nor should they.
    1 million people are already having to leave the country each year which is not an acceptable economic or social policy. The current administration has faiked on its promise to bring back OFW’s and done exactly the opposite as numbers continue to climb through financial desperation.
    The foundations laid now will determine what happens in the future and for the next generation. On current trends they can book a plane ticket early.

    If you laid all the Cabinet members end to end they still wouldn’t reach a conclusion

    And if people worked more efficiently and bred less frequently that could solve 2 problems in one! Work like rabbits, breed like pandas.

    A new paradigm is required.

    Understanding the scale and scope is a good starting point

    A view from The Atlantic.

    http://m.theatlantic.com/international/archive/2013/05/the-grim-reality-behind-the-philippines-economic-growth/275597/

    • Joe America says:

      I appreciate the comprehensive brief. Basically, there is material for 100 blogs or more there, and some I hammer at relentlessly, like why it is that DepEd still teaches rote learning instead of free thinking, associative thinking, problem solving and innovation. When your DepEd is dense, the nation is dense. Too many kids to teach, and pattern teaching for teachers who haven’t been taught those skills is likely a big reason.

      “But still, if you have to eat an elephant, enjoy a good sized steak every day, and you’ll eventually get it down.”

      • PinoyInEurope says:

        I was lucky to be in U.P. Elementary School, which is run by the U.P. College of Education. They tried all their experimental and new methods on us. U.P. is autonomous under the President and not under DepEd control. Neither is Pisay, which is controlled by DOST.

    • PinoyInEurope says:

      “except for the oligarchs, property developers, mall owners, and human traffickers”

      I was approached by red light barons in Munich exactly 3 times regarding Pinays. 😦

      Made me feel like many US blacks who get asked for drugs by every 2nd white guy.

      • sonny says:

        Slow burn …

        • PinoyInEurope says:

          It was a bit weird, well these people used to own a few normal restaurants/eateries and that is where I was asked. In the end I told them that I am not competent in that area and these possible front businesses are all gone now since my area is gentrifying.

    • PinoyInEurope says:

      “The task is daunting and OFW’s and BPO’s will not continue to absorb those numbers, and nor should they.” In the end they will no longer be able to.

      Joblessness is increasing in developing countries due to automatization.

      BPO outfits are being brought back to do nearshoring. A lot of SAP activities are being moved away from India to Romania at the moment – I know one of the bosses well.

      OFWs will not be needed as much. In Spain for example large parts of the population are moving to Germany and elsewhere to find work. Latin Americans who used to be treated like dirt when they were OFWs in Spain feel a sense of satisfaction when they see that.

      Assuming that command of English is enough for the Philippines is wrong. Other Asian countries do not need that much BPO and OFWs so the Philippines is lucky for now. My guesstimate is that in 8-9 years these sources of income will slowly start to decrease. If nothing else is there to replace them, all the secondary growth fueled by that income will dry out as well and then what? There may be no way out by then. Time to do more now.

  61. ray james says:

    Pie
    You/someone could start a metaplanning forum with ongoing and updated threads for each of the key issues facing the country, developing over time from problem identification through ideas generation, on to solutions recommendation and prioritisation.
    A national manifesto! Or even a series of regional ones.

    Move from personality politics to policies and programmes. Desparately needed.

    As is greater empowerment in the philippines. It is one of the aims of Diversity and Inclusion (D&I) strategies now being employed by corporates under the strategic banner of CSR ( corporate and social responsibility) a useful template in empowering people, generating community cohesion, and getting things done.

    Ultimately all about changing mindsets and transformation management – top down and bottom up.

    Try the free McKinsey app – Insights – sometimes useful articles

    Also moving on soon.

    • PinoyInEurope says:

      Thanks. I will have to find a community that will drive it though and does not need constant pushing by me. There has to a critical mass of people that want to take their future into their own hands and do not expect politicians to save them. Because that is unrealistic.

      In the end all politicians want power, I like to see them as lawyers for people’s interests. If you don’t know what you want from a lawyer he’ll charge you and you’re still not happy.

  62. ray james says:

    BPO’s and outsourcing was one of my key areas – since the 80’s. Arthur Andersen were at the forefront of the movement at the time – then a good way to sell consultancy, and now as Accenture it has proved to be a great business

    You are right. The industry is inevitably moving on for a variety of reasons.

    The problem in the philippines is that call centres have been a cash cow for too long, but not developed into a home grown industry. There are some exceptions, but i don’t think they see the global trends and do not think like corporates, so are being led by change, not leading innovation.
    It is essentially US corporates supplying the systems, hardware, the key managers etc with filipinos being bums on seats.
    And the corporates only rent properties/space, and since they have operations elsewhere ( especially india within asia) can switch the traffic flows at the flick of a button, and rapidly reduce the scale of operation in one country and refocus on another. Good contingency and flexibility on their parts – and the power of the networks means little allegiance anywhere since it is all transparent to the end custome.
    The philippines still predominantly focus on high volume low margin voice, which is a declining need, whilst india focus on knowledge based high margin services.
    And the next phase will incorporate AI ( artificial intelligence). Good luck to the philippines when that hits the market.

    New market entrants – brazil, south africa and korea ( my trip next week) also have strategic plans.

    Staff Turnover in philippines BPO’ s also averages between 50 – 60%!
    It is not jobs people want but a stop gap until they can find one abroad!
    A modern day assembly line but of no value for personal development and growth.

    Another missed opportunity by not planning ahead and taking strategic decisions. Simply going with the flow, but with someone else rowing you can end up the creek and without a paddle.

    To end on a lighter note!

    You’ve been a consultant for too long when… you have more phone numbers than Imelda Marcos has pairs of shoes.
    and others….

    Many a truth below!

    1) you refer to the yield of the tomato plants in your home garden as “deliverables”;
    2) you can tell the copier repair person at the client site exactly what’s wrong with the machine and what parts need
    to be replaced;
    3) the new client staff come to you for information on how to start the coffee machine;
    4) you’ve succeeded in memorizing the morning and afternoon schedules of two major airlines’ flights to your client’s site;
    5) you can execute five complex tasks simultaneously, but you can’t remember what you had for breakfast that
    morning;
    6) you have enough “vendor” ID badges for a royal flush and two pair;
    7) you know all the late night security guards at the client site on a first name basis (replace “security guards” with
    “cleanup staff” or “swing-shift mainframe operators” as you choose);
    8) you use so many acronyms you no longer know which are your company’s, the client’s or the software vendor’s;
    9) you feel naked without a laptop hanging from your left shoulder;
    10) the project partner tries to hire you;
    11) you forego the opportunity to fly home for vacation, because you really like it in Sierra Leone (Afghanistan, Haiti,
    Papua, Somaliland, …);
    12) you say “Whoopee! Half day!” when you leave at 10:00PM;
    13) your kids point at the phone and say “…that’s the one that’s broken” when you get home, thinking you must be
    from the repair service, ’cause you sure don’t look familiar;
    14) you start thinking that life in the US Navy Submarine Corps would give you more time at home;
    15) you start referring to your PC by a cute name;
    16) you are upset when you come home on Friday night and the lights aren’t on, the bed isn’t turned down, and there are
    no chocolates on your pillow;
    17) you fantasize about zero-billing;
    18) “vacationing” is spending an entire weekend in your own
    home;
    19) you can call room service and order multiple entrees without looking at the menu;
    20) writers for the OAG call you to verify flight numbers and times;
    21) you have seen more movies at 35,000 feet than you have at your local movie theater;
    22) you have had more phone numbers than Imelda Marcos has pairs of shoes;
    23) the media phrases “telecommuting” and “virtual office” have very real (and frightening) meaning for you;
    24) you forget how to turn on the windshield wipers in your own car;
    25) new staff point at you and say, “… that’s him, that’s the old guy … “;
    26) your resume’ looks like a phone book;
    27) the client says your rates are too high, and you blush;
    28) you introduce yourself to your next door neighbors …again;
    29) your spouse flies home (to your hotel) for the weekend;
    30) you use the word “paradigm” in a sentence;
    31) you use the word “granularity” in a sentence;
    32) you use the word “robust” in a sentence;
    33) someone mentions a 7:00 meeting and you say, “AM or PM?”;
    34) you cry when your PC won’t start;
    35) you carry on a 5 minute conversation about data warehousing, then you ask what it means;
    36) when other people speak of vacations in warm sunny places, you get a lost look on your face, cock your head to
    one side like a dog hearing a whistle, and say, “…my last vacation was, um, it was, ah, um, er ….”;
    37) you have a day off, and you call work because you miss it;
    38) you write a workplan for your weekends;
    39) someone asks you what you do for a living, and you can’t answer the question;
    40) before starting the car, you insist on telling everyone where the emergency exits are;
    41) before stopping the car, you insist that everyone stay seated until the fasten seatbelts sign is off;
    42) you call the computer support hotline with a support question just for the entertainment of hearing their answer;
    43) a good dinner consists of vending machine snacks;
    44) a good lunch consists of vending machine snacks;
    45) you insist that your friends submit time sheets at the end of the month so you can see what you missed;
    46) you can tell the hotel staff what their room-rate policy is;
    47) you believe that e-mail is as good as a conversation can get;
    48) instant coffee tastes good;
    49) you can remember 15 client and hotel phone numbers,
    but you get stumped when asked for your home number;
    50) you file more income tax returns than Microsoft has trademarks;
    51) you’ve been staying in the same hotel, you instinctively call it “home”;
    52) the hotel staff recognizes you and gives you the same room every time (this is not always good);
    53) the room service staff feels free to nag and fight with you because they know you’ll be back next month anyway;
    54) you know all the favorite radio stations of all the valet parking guys;
    55) you get more calls from the hotel staff to see if you’re
    OK than you do from your friends;
    56) then you realize the hotel staff are your friends;
    57) You ask the waiter what the restaurant’s core competencies are.
    58) You decide to re-org your family into a “team-based organization.”
    59) You refer to dating as test marketing.
    60) You can spell “paradigm.”
    61) You actually know what a paradigm is.
    62) You understand your airline’s fare structure.
    63) You write executive summaries on your love letters.
    64) You think that it’s actually efficient to write a ten page
    paper with six other people you don’t know.
    65) You believe every company is “a traditional functional organization,with promotion based on tenure, but one that
    needs to change as it is facing ever increasing competition…”
    66) You believe that a company’s problems are never caused
    by an”ineffective handling of an administrative situation.”
    67) You believe you never have any problems in your life, just “issues” and “improvement opportunities.”
    68) You know every single piece of clip art in PowerPoint.
    69) You calculate your own personal cost of capital.
    70) You explain to your bank manager that you prefer to think of yourself as “highly leveraged” as opposed to “in
    debt.”
    71) You can explain to somebody the difference between “re- engineering,””down- sizing,” “right-sizing,” and “firing
    people’s asses.”
    72) You actually believe your explanation in number 15.
    73) You start doing your kid’s math equations in reverse Polish notation.
    74) You enjoy using an HP-12C.
    75) You refer to your previous life as “my sunk cost.”
    76) Your three meals a day are a morning consumption function, a noontime consumption function, and an evening
    consumption function.
    77) You refer to your significant other as “my co-CEO.”
    78) Your favorite stories begin “Bob Jones, our Team Leader
    in Russia, sat at is desk and stared out his window…”
    79) You like both types of sandwiches: ham and turkey.
    80) You believe PCM is just as important as the Theory of Relativity.
    81) You believe PCM.
    82) You start to feel sorry for Dilbert’s boss.
    83) You believe the best tables and graphs take an hour to comprehend.
    84) You refer to divorce as “divestiture.”
    85) Your favorite artist is the one who does the dot drawings for the Wall Street Journal.
    86) None of your favorite publications have cartoons.
    87) You account for your tuition as a capital expenditure instead of an expense.
    88) You insist that you do some more market research
    before you and your spouse produce another child.
    89) At your last family reunion, you wanted to have an emergency meeting about their brand equity.
    90) You always call your mechanic before you start your car to see if it will blow up given the day’s weather conditions…
    91) …and expect him to use a decision tree to work it out.
    92) You’ve decided the only way to afford a house is to call your fellow alumni and offer to name a room after them, if
    they’ll help with the down payment.
    93) Your “deliverable” for Sunday evening is clean laundry and paid bills
    94) You use the term “value-added” without falling downlaughing.
    95) You ask the car salesman if the car comes with a whiteboard and Internet connection.
    96) You ask your bank manager if she has heard of “Modigliani-Miller”, and then you ask her if she has a pizza
    so you can show her.
    97) You give constructive feedback to your dog.
    98) you can list ninety-eight (and counting) reasons why you
    have been a consultant for too long.

    http://www.weitzenegger.de/en/index.html

    • PinoyInEurope says:

      Didn’t know that there were so few knowledge-based services in the Philippines.

      Know a few of them – Linde Accounting SSC, Accenture Accounting SSC, TSFI.

      Yeah, I remember a coach who seriously told us how he named his boy based on the future marketability of his name and explained it in detail – neutral, international, short… Luckily the old-fashioned look of Germany usually brings me back to normal thinking…

    • Joe America says:

      Hahaha, number 84 works for me, and OMG, I’ve got a lot of sunk costs . . .

  63. karl garcia says:

    turnover records in BPO does not show the complete picture of just moving around and go BPO hopping.

  64. ray james says:

    I don’t know the exact split, but i do know it is not easy to find virtual research assistants, or high quality android app developers in philippines. There will be some, but clearly not enough.

    It always goes back to the quality of basic education and the appropriate vocational skills the country wants to develop long term – integrated planning. Training for x years to be a nurse and ending up in a call centre on night shift is lose-lose. no wonder motivation is low and churn rate is high

    Core skills and competencies which are transferable and can be built upon over time, and life-long learning, but the greatest skill employers want is creativity.

    Call centre
    Voice based
    – Outbound calling ( telemarketing)
    – Inbound calling ( customer support)

    BPO
    Knowledge based
    – virtual services
    – legal, medical
    – application development

    ? The next wave
    KBA knowledge based analytics – ( just made it up)
    – data analytics
    – research and decision support
    – artificial intelligence
    – virtual partnering

    Niche markets
    – animation ( which the philippines has a small presence but good reputation – something to grow)
    – cloud services

    Simplistically i would tend to consider the following ( in consultant speak)

    From abritage to innovation

    From cherry picking to orchard planting

    From call centers to business partnerships

    From ‘bums on seats’ to ‘brains in the cloud’

    From generalists to specialists

    From low value to added value

    From procrastination to action

    From short term to long term

    From dependence to independence

    • Joe America says:

      Care to put this into a guest blog? One of the dilemmas seems to me to be that the movers and shakers don’t have an industry perspective, as they are just the bosses of their business, bums on seats, and mostly foreigners. Who is the caretaker of the industry? The migration to a lasting industry is perfectly encapsulated in your final list, but who in the world do we send it to, and expect something different to happen? Perplexing.

    • PinoyInEurope says:

      Yes, a guest blog would be great. If it reaches just a few of the decision-makers not caught too much in the daily grind and with more in mind for the country, it would already help.

  65. ray james says:

    Joe
    You are right.
    The managers are caretakers not business developers – ( they are not going out looking for customers, and negotiating contracts, understanding needs and trends, developing new services – that is all done far away at high level, and parachuted in to low lever operators and often a bad ‘manager’ to oversee the galley slaves.

    The critical aspects are service levels and customer satisfaction and in many ways the philippines is the outsource labour provider to the outsource contract holder who knows the plans of the end customer, but the manager in philippines will not be privy.)
    I have negotiated a few global outsource contracts and the lawyers can hide many tricks in case ever needed.

    I don’t know but i imagine most filipino staff are on short term contracts, maybe even through a holding company to protect the head office of Accenture etc. The focus will be on quotas and measurement of output with ? restrictive practices. Motivation by fear not encouragement. Another numbers game.

    And the service contracts themselves will be of no security to the BPO in the philippines, just to the BPO head office who can reallocate to other countries or even return on shore if they and their end user wish.

    Lets hope the caretaker managers do not end up as undertaker managers.

    will give the subject some thought

    • karl garcia says:

      Yes sir after the Korean trip Do a guest blog. PiE maybe you should invite mr James as a senior partner in your future empire Consultancies R Us thing.

      • Joe America says:

        I note you took your funny pills this morning, the ones with the label reading “sly wit, do not overdose”

      • karl garcia says:

        Include Joseph Hivo,Edgar,Gian Carlo (Not as a senior partner though)

        • PinoyInEurope says:

          Actually it was sonnys suggestion to do something like that, so I tried to check out how it could be done in practice. Sonny is very confident and idealistic that something is doable.

          The ones driving things should be the people back home, we who are abroad can only give some ideas based on what we have seen. We are not smarter just a bit luckier. Finally I am quite content with my situation, don’t need to make myself problems.

          • sonny says:

            I’m looking over my shoulder even as I speculate on the constitution of the 10-member teams. The wife is the organizer-guru in the house: devil is in the details she says and the plan must be well vetted before going to the details.

            Taking cues from PiE’s SAP references I let my systems background (what’s left of it) wander in the direction of governance and PH’s amelioration, while keeping an eye on PiE’s realistic caveats, e.g. “… But next thing I know some people in the Philippines will ask is who are you? ”

            Having said this, I will take another dive into the depths and scrounge around hoping to find some pearls.

            • i7sharp says:

              @sonny

              “… hoping to find some pearls.”

              Sonny, I hope and pray you will find many.

            • PinoyInEurope says:

              To put in a pragmatic idea to our brainstorming – frogmatic is what my brother would say and karl garcia would definitely agree: eat a frog in the morning, meaning start with the parts of the Philippines that have the greatest problems, for example Bangsamoro.

              Solve problems there first and then apply the approach you have perfected there and the experience of the initial team to go the the second-worst place along the Mississipi river, with crocodiles and everything just like in the Ligwasan marshes near Mamasapano.

              But regarding the ten-man teams, you will need a local guide, a security man and an anthropologist specialized in the area as support staff for the more difficult zones.

              So you need Indiana Jones and Crocodile Dundee as well, but not Crocodile Jones, kapatid ni Indiana Dundee as played by Filipino-American mestizo bakla Redford White. Kung ganyan ang isasama mo, mas masahol pa sa Mamasapano ang aabutin mo doon.

              The initial team, having solid experience, can then spread out an train more teams.

              • PinoyInEurope says:

                Always be frogmatic, never dogmatic, because then you will be like a dog.

                Unless you are a bit asongkalye, that is needed in many street situations.

                But in the swamps, it is better to be frogmatic and amphibious some times.

  66. ray james says:

    Caretaker/administrator
    Innovator/researcher
    Undertaker/dismantler
    Entrepreneur/business developer

    The 4 key types of manager which needs to match the type of company and its stage of growth/plans.

    You need all types but the philippines has an imbalance relative to the task of job creation and a big gulf between a few too powerful conglomerates which suck up any competition, exercise undue market control, and can therefore dampen innovation, crush competition, raise barriers to entry, and at the other end of the scale a multitude of microbusinesses which mainly focussed on basic day to day survival.

    The category to really develop are obviously SME’s and particularly those in STEM sector (science, technology etc).
    I am aware of some initiatives, but they seem like copycat approaches and outdated, not comprehensive proposals tailored to each market sector, ( such as a collaborative economy honeycomb and ‘crowd council’ approach on a regional basis, which i think might be applicable in the philippines) and not on a scale to make a real difference. More sticking plaster and ideas than a cohesive strategy but a start and that alone is to be welcomed providing it develops into something. Time will tell.

    Links between academia and companies also has room for improvement with practical benefits for both. Again i think a hit and miss approach currently.

    More competion will drive both efficiency and innovation.

    You can lead a horse to water but not make it drink. Maybe time to push a few in. Sink or swim strategy.

    In change management you give everyone an equal chance but usually end up promoting ‘ the champions’ , and ‘ squeezing the lemons’, and ‘ getting rid of the pips’.

    • PinoyInEurope says:

      “You can lead a horse to water but not make it drink.” Exactly.

      In the end the Philippines / its leaders will have to want things.

      If not its up to them. Maybe they are onto something different?

  67. ray james says:

    the new wave is getting closer and bigger.
    Every change can be either an opportunity or threat.
    This has aspects of both for philippines and BPO’s.
    Great opportunity also for system integrators, and of course consultants!

    Released today (extract)

    IBM says it now has more than 200 global companies gearing up to use mobile phone apps through its partnership with Apple.

    The partnership has announced 14 app templates so far, which IBM then works with clients to customise with specific company data and analytics.
    The goal is to create 100 business apps running on iPhones or iPads by the end of this year
    Besides design expertise for the apps themselves, Apple provides remote technical support for a company’s own technology departments managing the apps.

  68. JQ says:

    You forgot to mention that all this GDP growth started during the term of PGMA. She started the programs for economic growth. The current administration just continued said programs. Even international media acknowledges the huge contribution of PGMA to the economy. While the New York Times once said in an editorial that PNoy just did what he does best: Nothing. Which is good, actually, he just continued what PGMA started to get those numbers. So i guess we shouldn’t complain much about PNoy because guess what, all the Noynoying actually became useful to the economy.

  69. Apo Chumachil says:

    Yay, another Malacañang-concocted piece of propaganda, which is actually laughable, like the current situation of your beloved People’s Television.

    Actually, the so-called economic growth is only concentrated among the oligarchs of Imperial Manila, while the provinces consumed the carcasses.

    Maybe you did’nt watched I-Witness and Malou Mangahas documentaries (and also Word of the Lourd, FYI) as they featured the bitter realities of the REAL Philippines.

    Au revoir, and keep on being delusional, optimistic. idiots!!!!

    LELELEL!!!!

  70. Apo Chumachil says:

    4Ps? A laughable joke, especially when it comes to auctioning of ATMs.

  71. Apo Chumachil says:

    What’s wrong on being frank? Tell me, what’s wrong on being truthful?

    At least, I can comment on GetRealPhilippines as they reflected the BITTER REALITY of this God-foresaken of a country called Philippines.

    • Joe America says:

      There is nothing wrong with being truthful. If the truth is that you are bitter about the Philippines, I’d like to know your circumstance and how you came to that position. Get Real indeed approves bitter comments. However, I can’t comment there because I am not bitter. I’m banned. So the censorship is in the eyes and values of the editor.

      For this blog, the comment standards allow any side of any issue. However, they do not permit personal insult, or demeaning language that is aimed at winning the argument by destroying someone else. When you demean me as the editor of the blog, without first having a discussion about the issue – say Mar Roxas – that is a kind of poison for the blog I have worked years to create. As an honest open forum for discussion of issues.

      Not allowed.

      If you want to say why Mar Roxas ought not be President, have at. If you want to discuss censorship and editorial rights, have at.

      Read the comments from others. Then read your comments.

      I’m sure you are sharp enough to catch the distinction in style and content.

      I will keep you in the moderated class and allow through any comments that meet the editorial standards of the blog. That will sometimes result in a delay in publication of comments, but you can get rid of the delay by demonstrating the ability to interact on the basis of issues and not taking the issues to personal disparagement.

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