No Free Lunch

Urgency and proactive governance

In 1991, Metro Manila and the rest of Luzon suffered long daily power outages (aka brownouts) because demand had well outstripped generation capacity. Five years before, the government decided not to operate the Bataan Nuclear Power Plant, plagued from the beginning by safety and corruption issues. The disastrous April 1986 Chernobyl nuclear accident in Ukraine sparked the final decision to scrap the plant, which was to provide 621 megawatts of new power. But the government somehow missed providing any new alternative power sources to make up for it.

This failure of planning and action cost the Philippine economy negative growth in 1991—not to mention great hardship to millions of Filipinos affected by the lack of electricity. The power situation put the newly elected administration of Fidel V. Ramos in 1992 in a great bind, its back literally against the wall to act with extreme urgency. It embarked on immediate relief via emergency diesel power plants, and set in motion the construction of long-term power capacity needed to bring the Philippine economy into the 21st century.


In 1995, the price of rice skyrocketed and long queues for subsidized rice formed at the National Food Authority, the only entity that could import rice then (and until recently), because the NFA had made bad timing decisions on importing the grain. It was around then that the country sought and obtained a waiver from the newly formed World Trade Organization on removing quantitative restrictions (QRs) on rice imports and converting them into import tariffs. Meant to give the country additional “breathing space” so we could work to make our own rice industry competitive, we ended up extending the waiver twice, keeping the QRs for more than another two decades.

We somehow got too comfortable with the trade wall we built and maintained around the rice industry, leading to complacency on long-term measures needed to raise productivity in rice farming and processing for international competitiveness. While episodes of zooming rice prices hit every administration since, it took last year’s dramatic price spike—again and as always, due to bad import timing decisions by the NFA—to finally get the government to take the step that will force it out of such complacency, and truly work toward the sustainable long-term welfare of our farmers.


Today, the hot issue is lack of water in Metro Manila, and the long and short of it is that the government failed to do what it should have done years ago, which is to provide for new sources of water for the metropolis beyond what Angat Dam supplies. More than 10 years ago, as independent director in the Manila Water Company then, I was already hearing calls from the company’s management for the government to plan and put in place additional water sources to feed Metro Manila’s rapidly growing needs. The company had done the admirable job of dramatically reducing nonrevenue water (NRW)—water lost from leaky pipes or stolen through illegal connections—from around 65 percent down to the low teens, via huge investments to replace old pipes and improved community distribution mechanisms. Those savings effectively saved taxpayers the cost of a new dam’s additional water supply.

But Manila Water had already exceeded world norms in NRW efficiency, and was urging the government to act back then, if we were to meet future needs. But somehow, we again had to wait until our backs are literally against the proverbial wall, for the government to finally get moving. Critics allege that the solution now urgently offered us—the China-funded Kaliwa Dam project—is not only disadvantageous to the government, but also harmful to long-term social and environmental sustainability. And yet there were several more alternatives that could have been pursued much earlier, if the government had only moved with more proactiveness and anticipation.

To be fair, our national planners have always looked far ahead in planning our future. But all too often, it is politicians and inept bureaucrats who lack the sense of urgency and anticipatory action that has earned us the description of being great in planning, but miserable failures in execution.

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TAGS: Angat Dam, brownout, Cielito Habito, Electricity, governance, Kaliwa Dam, Manila Water, No Free Lunch, Philippine economy, planning, Power, shortage, water
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