Importance of good governance to progress
The medium-term headline goals of the Marcos Jr. administration are very challenging amid the economic scarring caused by the pandemic and the disruptions in the global supply chain and financial system.
With the immediate goal of recovery and regaining the development momentum, a rethinking of economic approaches and how the government could facilitate development points to the strategic importance of investments to our economy and everyday life.
To address joblessness, which currently stands at 6 percent and translates to 2.99 million jobless Filipinos, domestic and foreign investments can fund many projects and support the MSMEs in terms of providing jobs, income, and livelihoods.
In the second quarter of 2022, the country’s gross domestic product (GDP) contracted by 0.8 percent, from 8.2 percent in the first quarter to 7.4 percent in the second despite the fact that the economic sectors of agriculture, forestry and fishing, industry, and services exhibited across-the-board growths.
This was primarily driven by inflation, which increased from 6.1 percent in June to 6.4 percent in July 2022, close to the highest inflation rate of 6.9 percent recorded in October 2018.
Inflation has always been a major concern of Filipinos. But what makes this condition bearable is the existence of job and livelihood opportunities created by investments.
Pursuing investment-led and more sustainable growth necessitates the attraction of the “right investments” that can harness the quantity and quality of our human workforce in a fast-evolving digital world. Also critical will be the constant upskilling of the Filipino workforce for the country to thrive in a highly digital global ecosystem.
Central to the building of an investment-driven economy is good governance. An enabling policy environment, an efficient and transparent bureaucracy, and the government’s consistent adherence to the rule of law are fundamental requisites to investor trust and confidence to commit big capital.
A notable development is the merger being undertaken by TV5 and ABS-CBN. This corporate union will revitalize several things—the democratic relationship between the state and media, the preservation of the livelihoods of countless dependents and allied industries, and providing well-vetted news to the public.
In essence, this merger inspires a positive outlook for the media industry and will hopefully become a beacon of truth, public awareness, and driver of socioeconomic growth.
As expected, there are critics of the merger, which is reminiscent of the highly politicized disapproval of the ABS-CBN franchise. It should be remembered how the country’s reputation as a democratic state was tarnished and how there was a palpable “chilling effect” on the media industry threatened to suffer the same fate should the political leadership be displeased.
In this instance, much can be learned about the important role of good governance and its impact on the country’s investment climate. Government powers should be used to strengthen and build industries and not to mete out politically motivated agendas which, in this case, greatly affected a whole industry and thousands of stakeholders.
This is an important lesson that the Marcos Jr. administration will hopefully remedy by focusing on the headline goals of real GDP, single-digit poverty rate, the national government deficit, national government debt-to-GDP ratio, and gross national income. All these can be addressed with synergistic partnerships with the private sector and the participation of the whole of society.
Successfully activating all these elements of good governance will create an empowered national ecosystem that we need to be in a competitive position to motivate both local and foreign direct investments in the Philippines. An openness and boldness to initiate reforms that will make our governance system responsive to the current and future challenges and a clear roadmap for sustainable growth under a regime of good governance is the right direction to accelerate the velocity of inclusive prosperity for the Filipino people.
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Dindo Manhit is the founder and CEO of the Stratbase Group.
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