Economist Cielito Habito, in his column “Investment: our crying need” (Opinion, 2/17/14), says the low level of foreign investments in our country, compared to our neighbors, is the reason for the increasing joblessness. He highlighted foreign direct investments (FDI) in 2004-2011 (8 years) in Indonesia ($4.5 billion), Thailand ($4.5 billion) Vietnam ($5.3 billion) and Singapore ($15.7 billion) against ours (only $1.1 billion). He then attributed their having lower joblessness to the FDIs. I disagree.
In fact, our government is, to some extent, responsible for the lower joblessness in those countries, which in turn is the reason for the higher joblessness in our country.
Take Vietnam. According to the World Bank, the labor force in Vietnam is 48 percent in agriculture, 31 percent in services and 21 percent in industry. Of the total FDIs that entered Vietnam only 8.8 percent went into agriculture, 64.8 percent into industry, and 26.4 percent into services. If Habito is correct that more FDIs mean plenty of jobs, how come industry, which absorbed the most FDIs, has the lowest percentage of workers; while agriculture, which absorbed the least FDIs accounts for almost half of the labor force?
Our government is also responsible for the lower joblessness in Vietnam. Our purchases of rice, as well as those of other countries, are the main reason—not the FDIs—the bulk of Vietnam’s labor force is in agriculture. Vietnam is the world’s biggest rice exporter and we are its second biggest customer (after China). To date, we have bought more than $1 billion (P44 billion) worth of rice from Vietnam. All these years that we have been buying rice from Vietnam, our government has been “creating” jobs for Vietnam’s farmers, jobs which could have gone into our impoverished countrymen had our government made rice sufficiency and food security its topmost priority.
In the 1970s and 1980s, we were exporting rice to other countries and there was not a single foreign investor in rice production at that time. Our balance of trade with Vietnam says we are a net importer of Vietnam’s products by $4 billion.
Our balance of trade—combining Vietnam, Thailand and Indonesia—shows we have a trade deficit of $16 billion, meaning, we are creating more job opportunities for their people while they are creating less for us.
In my letter to the editor “Jueteng as solution” (Opinion, 2/21/13), I estimated the amount of money from “jueteng” to be P88 billion ($2 billion) yearly or $16 billion in eight years, surpassing even the FDI in Singapore ($15.7 billion). Assume I am only 50 percent correct in my estimate, that still means $8 billion, which is even bigger than the FDI in Indonesia ($4.5 billion), Thailand ($4.8 billion) and Vietnam ($5.3 billion). At 30 percent accuracy, or $4.8 billion, it is still comparable to the FDIs in those countries.
As I have shown, more foreign investments do not necessarily mean plenty of jobs. Good if they come, but we shouldn’t beg. But more important, there is so much “jueteng” money, even bigger than the foreign investments in neighboring countries, being wasted which we should be using for our country’s economic development.
—ERNIE ADAYA,
ernie_adaya@yahoo.com