Monday, September 24, 2018
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What sort of president?

Last week I said, if the polls are to be believed, Rodrigo Duterte will be the next president of the Philippines. The most recent, desperate attempts in the past two weeks to discredit him are too late to make any impact. And there are only four days left before the elections, two of those a weekend.

The latest polls say it’s Duterte. SWS reported he is the choice of 33 percent of likely voters, with only 24 percent going for Grace Poe, 19 percent for Mar Roxas and 14 percent for Jejomar Binay. Pulse Asia’s last survey also points to Duterte as the winner (33 percent), followed by Roxas (22 percent), Poe (21 percent) and Binay (17 percent).


So it looks like Duterte will be president. We better get used to the idea.

So what sort of president would he be? That’s a tough question to answer as he hasn’t said much of what he’d do or believes in. But for now I’d just like to focus on business.

His speech at a recent briefing before the Makati Business Club and Management Association of the Philippines was worrying. He said little of what business wanted to know; instead he raised fears of a dictatorial leadership. But from what I gathered in conversations with him and from his public statements, honest business need not worry; he isn’t going to interfere.

Open markets will remain, and entry to the Trans-Pacific Partnership will be pursued in line with changes to the Constitution, one of which should remove the foreign investment restrictions, although land ownership will probably not be covered. The changes—likely to include the shift to a federal and, maybe, parliamentary system—will be submitted for approval in a plebiscite probably to be held in the 2019 midterm elections.

Computerization of bureaucratic processes will be promoted through a Department of Information and Communications Technology, in government and the private sector. Along with that, I believe he really will simplify (not just promise to) the bureaucracy. He abhors it as much as I do.

Taxes will be reviewed and brought to levels competitive with those of other Asian countries. Expect a 25-percent corporate income tax for a start, and the lowering or even removal of the low-salaried employees’ income tax. How far he’ll go would depend on the tax reforms’ impact on the national budget. Can funds be found elsewhere? I believe so—if there’s political will, and I think Duterte has political will. He has made that abundantly clear.

He’ll revive mining—the responsible kind. The existing tax impositions will be reviewed, but I hope that whatever changes will be made won’t apply to those investing now or to those already operating—unless the new taxes turn out lower, which is a remote possibility.

The Public-Private Partnership will be pursued along the same path on which it was started. I’d like to see the premium payment scrapped, and instead go for the bidder who offers the lowest toll or fee. The Aquino administration was consumed by its fascination with cash; longer term, wider benefit wasn’t in its equation. I expect that to change with the next president.

With a Mindanaoan as president, the first-ever, there’ll inevitably be a focus on Mindanao. That should bring agriculture (the island’s backbone) back into the national agenda as well. Finally, the sector on which the poorest depend will get some attention after languishing in the doldrums for so long.


The problem of how to handle the Muslim situation will see a fresh approach. I’m just not too sure what that will be, but given his relationship there (better than Mr. Aquino ever had), I see some promise.

Duterte, like all of the other presidential aspirants, is against contractualization. But whether he’ll accept the solution I broached last week, I’m not sure. I can only hope.

One thing sure: He won’t adapt this administration’s practice of violating or changing contracts to suit its mood of the day. I’d like to hope that, early on, he would revoke the changes Mr. Aquino has forcibly introduced.

On education, he said he is against the K-to-12 program. This makes no sense. The world, except for Angola and Djibouti, has a 12-year basic education cycle. The introduction of K-12 here was messed up, but that can be fixed.

On health, he has promised free services for all, as needed, and a greater shift to primary, outpatient health-care services to catch illnesses before they get worse and fully cover the huge costs of serious illnesses; he also vowed that government will promote a healthy lifestyle. (I wish he was around when I was young.) This will put him in a quandary. He wants to restrict smoking as he did in Davao, but smoking (through sin taxes) provided close to P40 billion of the 2015 health budget. This is one issue he should think through more carefully. I’ve always believed that people should always be able to do whatever they want, as long as it doesn’t negatively impact on society or on others. Inside your bedroom, for example, smoke as much as you want to; or you can indulge yourself with too much sugar (or, in my case, wine). It’s your choice. Government’s only role should be to inform you of the consequences of your health-consuming habits.

Then there’s drug abuse and criminality. I don’t need to say anything here. He has more than said what he’d do.

On a new international airport, I’d expect a decision this year on where this will be; no more pussyfooting on the matter.

Traffic? A longer-term solution is needed, he said, and the focus must be on a far better public system. For Manila, principally, it should be trains, but putting such project in place will entail time beyond his term. In the meanwhile, the discipline he’s imposed in Davao will “migrate” to Manila, he said.

All this sounds good but raises an understandable level of fear.


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