PH’s structural issues are serious, deep-seated

Cielito F. Habito’s column titled, “Wanted: sustainable cities” (Opinion, 6/30/17) noted that the benefit of urbanization in the Philippines has been seen in increased productivity, economic growth and poverty reduction; but the World Bank report observes that the country has not benefited from urbanization gains as much as other countries have. This is attributed to the country’s structural issues, namely: archipelagic geography which makes connectivity a great challenge, shifting directly from an agriculture-based to a service-dominated economy, and high exposure to floods and earthquakes which requires cities to become sustainable.

This qualitative presentation of facts can be corroborated by the quantitative presentation of figures through analysis of certain data about neighboring countries, culled from the CIA World Factbook. To wit:

1. The gross domestic product (GDP) per capita PPP (purchasing power parity) and the population poverty incidence (PPI) are as follows: China—$14,100 and 6.1 percent; Indonesia—$11,100 and 11.3 percent; Vietnam—$6,000 and 11.3 percent and the Philippines—$7,300 and 21.6 percent.

2. Based on the GDP composition by sector, the agricultural sector has the following figures: China, Indonesia and Vietnam have GDP per capita which are 65 percent, 90 percent and 40 percent higher than that of the Philippines, respectively.

3. In the industrial sector: China, Indonesia and Vietnam have GDP per capita which are 170 percent, 110 percent and 3 percent higher.

4. In the service sector: China and Indonesia have GDP per capita which are 60 percent and 13 percent higher than that of the country, respectively, although that of Vietnam is 40 percent lower.

The above data clearly show that the country has relatively low agricultural productivity. This makes the Philippine Development Plan target PPI of 14 percent difficult to achieve despite the attainment of very high GDP growth of 6.5-7.0 percent, if the government will continue to pay lip service to the further development of the agricultural sector. This is because this sector is facing serious deep-seated problems: first, the farmers, of whom 70 percent are landless, registered a very high PPI of 38.3 percent, and second, the unabated declining growth rates of agricultural production: 2.75 percent for 2007-2009, 1.76 percent in 2010-2012, 0.98 percent in 2013-2015 and 1.41 percent decline in 2016, based on Philippine Statistics Authority data.

Nevertheless, the target PPI could be easily attained in Luzon with PPI of 15.7 percent but not in the Visayas and Mindanao with PPI of 33.2 percent and 41.3 percent. The extreme poverty in Mindanao is the root cause of the everlasting political instability and violence therein, while the highly agricultural and poorest Autonomous Region in Muslim Mindanao, the heart of which is Marawi City, is the pivotal point of the crisis and conflict.

EDMUNDO ENDEREZ, [email protected]