Harnessing economic diplomacy
BACK IN the 1990s, President Fidel V. Ramos instructed our embassies, consulates and honorary consuls abroad to give greater focus on economic diplomacy, relative to the political dimension of their diplomatic work. Our foreign missions were directed to put more of their energies and resources into seeking and seizing opportunities for increased trade, tourism, investment, development assistance, and economic intelligence. The last refers to information from both formal and informal sources that may have relevance to maximizing our economic opportunities overseas. This includes monitoring and analyzing economic policies and measures in our embassies’ host countries that may be material to our international trade and investment interests with them, whether bilaterally or under multilateral trade agreements. Thus, beyond ensuring the welfare of overseas Filipino workers wherever they were deployed, our embassies and other missions abroad were to be both “listening posts” and proactive promoters of the country’s economic interests.
During my days in the government in the 1990s, I was struck at how some of the courtesy calls and visits I received from foreign officials and diplomats made me feel like my guests were engaged in some kind of an intelligence-gathering exercise. I particularly noted how the aides of visiting officials from a particular country appeared to be taking copious notes of meetings I had with them. A later incident showed me how much mileage that foreign government had been getting from these notes taken by my visitors.
In one official visit I made to my government counterpart in that country, I was surprised at how my host mentioned a little-known detail that I had brought up in a much earlier visit with me, not by that same official, but by another official in his government. That incident suggested to me that certain relevant information gathered by their officials in meetings with our own were probably being routinely shared even across ministries within their government, wherever useful. I began to wonder then whether our own diplomats and government officials traveling abroad were as perceptive and deliberate as they visited their counterparts abroad. This was among the important implications of President Ramos’ directive on economic diplomacy, if taken to heart by all concerned.
Ramos had also directed our foreign missions to keep track of highly skilled expatriate Filipino professionals, organize them into science and technology advisory councils, and tap them to assist in efforts to upgrade our technological capabilities. Programs were mobilized to attract highly skilled Filipinos to come home either temporarily or permanently, such as the “Balik Scientist” program. Not a few expatriate Filipino experts were enticed to return to take advantage of the new professional opportunities at home due to the newfound economic dynamism that came about under Ramos’ leadership.
Getting much more mileage from our foreign missions and visits by our officials to their counterparts abroad is imperative given the vast scope for improvement in our trade and investment relationships overseas. It has been encouraging that we managed to attract more than $6 billion per year in foreign direct investment (FDI) inflows in the last two years, which is six times our average annual performance in the past decade. But even this six-fold expansion was not good enough, as it still pales in comparison to Vietnam’s $8.9 billion, Thailand’s $12.7 billion, and Indonesia’s $25.9 billion in FDI inflows in 2014. In the past decade, our annual export earnings averaged $37 billion, against Vietnam’s $50 billion, Indonesia’s $120 billion, and Thailand’s $150 billion. We raised our export figure to $62 billion in 2014, approaching double of our past record—but the fact is, our neighbors had pulled away even farther ahead of us. Vietnam already tripled its export earnings to $150 billion, while Indonesia and Thailand got $176 billion and $225 billion, respectively. We’ve made much progress in the past six years, but there was scope to have done so much more, as our neighbors made even more progress than we did.
Vast opportunities remain untapped in nontraditional economic partners in Central and Eastern Europe. In an official visit to Croatia in the 1990s, I learned that I had been the highest-ranking Philippine official to ever visit that country. But I found that Malaysia’s then Prime Minister Mahathir had already visited twice within that same year, forging major business deals for his country. Similar untapped opportunities lie in Central and South America, still largely insignificant in our trade and investment relationships. And yet our neighbors Vietnam, Malaysia and Indonesia have made much more headway in those economies, despite our logical advantage arising from the historical Hispanic colonial ties we share with Latin America. And we can do so much more to maximize market opportunities from aging populations and tremendous demand growth for outsourced services in wealthy countries. With proactive and strategic thinking, more of such opportunities can be identified and pursued deliberately.
President Aquino has been the best salesman for the country, just as President Ramos was acknowledged to be the country’s most effective salesman during his time. But everyone down the line, from our government officials visiting abroad to our diplomats stationed there, must do just as well. Economic diplomacy and economic intelligence could be a potent tool for inclusive growth and development, and it would be a waste not to make the most of it.
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