A win for economy, environment

The Philippines is a country that relies heavily on four-wheeled motor vehicles as the main mode of transportation for the people, and that will not change anytime soon. For the foreseeable future, Filipinos will have to commute to work on buses, or take the jeepney to market, the tricycle to school, or, for those fortunate enough to be able to afford them, private cars to wherever it is they need to go.

For the foreseeable future, the mobility needs of the majority of our citizens can only be satisfied partially (and “partially” is a very generous term in this context) by mass transit systems which is the ideal mode of transportation for high-density urban areas of which more and more of our cities are turning into.

It is far from ideal but, for now, motor vehicles are still the way to go, literally and figuratively.

But that does not mean that we are doomed to polluting the air with the carbon monoxide from the internal combustion engines of our cars and jeepneys while we wait for the government and the private sector to get their act together and build more railways for our suffering commuters.

Technology has advanced to such a degree that electric vehicles, once thought of as novelties or niche products, are now coming into the mainstream as viable alternatives to cars, scooters, buses, and even cargo trucks that pollute the air with their fossil fuel exhaust.

To this end, President Marcos is on the right track in ordering his advisers to look at the viability of making the Philippines a production hub for electric vehicles.

If this comes to pass—and that remains a big “if,” given the country’s relatively poor track record in attracting investments in heavy industries like automotive manufacturing—making four-, three-, and two-wheeled vehicles powered by batteries instead of gasoline or diesel will provide the country with an economic windfall. It can potentially create thousands of new jobs and could catapult the Philippines further up the development ladder, where it has made uneven progress in climbing over the years.

At the same time, setting our sights on the production of electric vehicles, whether as complete units or even just their key components, will help the bulk of Filipinos who are still hesitant to give up their internal combustion engine-powered cars and jeepneys with the more nature-friendly, battery-powered variety.

In short, moving toward electric vehicle production and use will go a long way in helping preserve what’s left of our damaged environment.

But to succeed means traveling a long road amid the challenging terrain that is the Philippines.

The top issue that policymakers will have to hurdle is the divided public opinion about the mining industry on which the production of batteries for electric vehicles will depend. At present, local mining firms are already enjoying substantial revenues thanks to global demand for nickel which is a key component of rechargeable batteries. But if the government decides to make those batteries here, mining activities will have to pick up substantially to meet that need for more raw materials. Is the administration willing to expend political capital on this to power through the inevitable opposition? And, if so, will the next president have the same resolve to see the multiyear project through? Or will succeeding leaders succumb to the old Philippine affliction of changing policies to the consternation of business and industry?

In the meantime, while these long-term policies are being decided on and crafted, there is something Mr. Marcos can do that will benefit the industry over the short term and help electric vehicles take root in the country: The Chief Executive can expand the tax breaks for this industry, especially two-wheeled scooters and three-wheeled pedicabs and tricycles that are powered by batteries. These two types are the ones that the mass market can afford the most, rather than battery-powered cars that sell at luxury prices.

To be sure, tax incentives are precious commodities in an environment where the government needs to raise more revenues. But they will be well utilized for the purpose of promoting a greener transportation system.

To this end, the Marcos administration must mobilize the government and the private sector toward these twin goals as if they were one: making the country an electric vehicle production hub and making more Filipinos use electric vehicles more.

This is one policy where we will not have to choose between the economy and the environment. It will be a win-win for both.