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They did OK

/ 04:25 AM April 11, 2022

Last week, Finance Secretary Sonny Dominguez and Bangko Sentral ng Pilipinas Governor Benjamin Diokno presented to us the achievements of the Duterte administration over the past six years. Here I’ll focus on what Dominguez said. He (correctly) pointed out that they have turned an inward-looking economy into one ready to compete with the rest of the world.

Governments like to amplify their achievements, overlooking where they haven’t done so well. But in this case, the achievements listed by Dominguez are truly ones that have changed the Philippine economy in very fundamental ways, ways previous governments sometimes tried but never fully succeeded at. Ones that have positioned the Philippines to be a much stronger player amongst its peers in the region. Ones that the next government can use to accelerate the country back into the leadership position it used to hold in Asia before Marcos Sr. brought it all crumbling down.

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Let me enumerate and comment on the achievements the secretary listed in a well-thought-out presentation on April 5.

The Muslims in Mindanao have been given their long-demanded autonomy through the creation of the Bangsamoro Autonomous Region. This has been a sore point in the relations with the government for decades and has resulted in bloody encounters between the military and Moro groups.

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The Ease of Doing Business law has started the essential shift to a fully digitized government and is progressing well with the creation of the Anti-Red Tape Authority and its success in simplifying and speeding relations between government and business.

On top of that, two of the principal agencies business deals with are well on the way to full digitization. The Bureau of Internal Revenue conducted 99.5 percent of its tax payments online in 2021, versus a negligible 10 percent in 2015. Meanwhile, 82 percent of the Bureau of Customs procedures have been automated through its modernization program. But accusations of corruption still remain. We now also have a fully digitized bank, the Overseas Filipino Bank serving Filipinos worldwide.

The national ID is coming into place, but far too slowly, and with limitations a modern ID system shouldn’t have. We’re three years into the introduction of the system, but only 61.3 million Filipinos have registered. And a far smaller 8 million actually have their ID cards (a card a truly modern system wouldn’t require). It’s a system that doesn’t have voice recognition, a major failing given that smart phones are ever so more the way in which we undertake all our dealings with the government, and with the world.

The Bureau of Treasury introduced government securities in small denominations that can be bought online and are a good way for the public to safely invest their savings. Along with it is the Real Estate Investment Trust where small investors can invest and earn dividends. Some P270 billion has been invested so far.

The failed National Food Authority has had its wings clipped with the Rice Tariffication Act that brought rice into the open market, where it belongs. The price of well-milled rice has fallen from P45 per kilo in 2018 to P38 per kilo in 2021, with a wider variety of choices. The government has generated P46.6 billion in import tariffs.

A ground shaking change has been in the taxes we pay: they are less. And where it’s well justified: more. The less has been in personal income taxes where all but the rich now pay less. People with annual taxable income below P250,000 don’t pay any tax at all. Meanwhile, big corporations pay a reduced 25 percent corporate income taxes, while small businesses only pay 20 percent CIT. Making us more competitive in the region and, hence, more attractive to foreign investors and to the expansion of our business.

What has gone up are sin taxes on those who smoke and drink (I continue to believe red wine should be excluded, as a glass a day is medically beneficial. But I suspect that’s a lost cause). Sugary sweetened beverages were added to the list of taxable drinks. That should be a help in fighting diabetes and obesity. Also up are the excise taxes on petroleum products and automobiles. And with it, fuel marking to catch the fuel smugglers.

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For the first time ever, the Philippines attained high investment grade credit, rating from the various credit rating agencies, and has maintained it despite COVID-19.

Where there was considerable success was in the “Build Build Build” program. That targets weren’t met is irrelevant. That double the percent of gross domestic product spent is relevant. President Benigno Aquino III spent P297.5 billion annually on average, while President Duterte put in P881.9 billion average each year.

These were more, but you get the message. There’s been much accomplished on the economic side under the Duterte presidency.

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TAGS: Benjamin Diokno, Carlos Dominguez III, Duterte administration, Like It Is, Peter Wallace, Philippine economy
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