The Philippines is one of the longest running tele-novelas in economic mismanagement and operations mismanagement. A foreign visitor or a returning expat will be at a loss whether to feel pity, disgust, contempt, outrage, agony or desperation at the state of affairs in the islands. Here are the latest goings on – in brief.
Tropical Paradise turns out to be a huge pile of junk. Welcome to the Philippines.
Lines and Waiting Times – The Value of Waste
Shorter lines but longer waiting time awaits returning overseas Filipino workers (OFWs).
To keep the queues of vacationing OFWs short, the Philippine Overseas Employment Administration (POEA) has adopted new procedures and processing of the mandatory travel exit clearance.
“The new procedures would allow our OFWs to efficiently manage their time in securing travel exit clearance by adjusting the processing time in two phases,” POEA chief Carlos Cao Jr. said.
Under the new POEA policy, all returning OFWs shall submit the application and all the necessary requirements in securing exit clearance before the POEA for appropriate evaluation.
If all the documents are in order, the POEA would issue a claim stub to the OFW, who shall then return the following day to get the necessary exit clearance.
It’s the Pinoy version of improvement. From long lines and long waits. To short lines and LONGER waiting time.
Why can’t it just be shorter lines and shorter waiting times?
The POEA is in itself a source of the delay – as it COLLECTS more money from Filipinos going overseas. These exit clearances do not provide a value and just cause unnecessary delays and loss of income. The quantities involved might seem small on a first look. However, given that in 2008 there were 4800 Filipinos leaving the country daily for employment abroad – that’s approximately 1,752,000 exit clearances submitted annually. The 24 hour delay racks up 42,080,000 hours – roughly 5,256,000 workdays (@ 8 hours per workday) WASTED.
What’s the dollar value of these hours WASTED by the POEA? Roughly PhP 3.7 BILLION PESOS.
Assuming that:
- The average OFW salary is $400/month.
- There are 24 workdays in a typical month.
- Therefore the daily wage for is $400/24 = $17/day.
- 5,256,000 workdays x $17/day = $87,600,000 or roughly PhP 3,766,800,000
By delaying the exit of OFWs to collect a clearance fee (which is used dubiously anyways) , the POEA actually caused an opportunity loss of PhP 3.7 Billion to the economy.
For short – while the Philippine government gained in collections from exit clearances – it lost a lot more by delaying the exit of OFWs. The net cost of this policy actually results to a revenue loss.
Intelligence and Budgets
Ochoa has P300-million intel budget as anti-organized crime chief
This additional assignment to Ochoa is reminiscent of the DILG USec assignment of Puno.
Ochoa, intelligence, and budget does not seem to go together well into one sentence. What are these people going to snoop on when they already have ABS-CBN as information source? Seriously, is Ochoa the right person to be an anti-organized crime chief?
Another case of appointing incompetent people to a job of great responsibility. This isn’t surprising however as it just carries on with a great Filipino tradition of mediocrity. Voters vote for incompetent candidates. Incompetent president appoint incompetent staff. Which is approved by equally incompetent lawmakers. Which in the end leads to horrendous results in law enforcement – no laws enforced, but the statistics look good.
Aquino’s Ratings
As the Philippine economy eats the dust of ASEAN neighbors Thailand and Vietnam, the Philippines brandishes the usual polls to the clueless Filipino consumer.
7 of 10 Pinoys trust Noy – poll goes the latest headlines.
The corruption index has increased, competitiveness has decreased, hunger has increased, prices of basic services and commodities have skyrocketed – and yet Pinoys are still happy. In this country called the Philippines – ignorance is bliss.
Now would be a good time to remind Aquino of his campaign promise on doubtful statistics
From a government that merely conjures economic growth statistics that our people know to be unreal… to a government that prioritizes jobs that empower the people and provide them with opportunities to rise above poverty.
The crux of the matter when it comes to government indices is the misleading use of statistics. For example, Philippine newspapers banner economic growth of say 4.9% as proof of a good economy under Aquino. What’s not being said is that 4.9% is not enough, growth has to be higher than 6% to cope with the increase in the numbers of the labor force.
Expressed in another light, if you were making a purchase in a sari-store – you are praised that you have 80 centavos. But in order to actually possess the item you want – you need one hundred centavos. Will you get the item you want? No you will not.
In like manner – big deal there’s 4.9% growth – but, it’s not enough to make a dent – the Philippines is still in deep shit.
Another application of these same principle is on the observation that ““The fundamentals for strong domestic-led expansion are still in place,” said Vincent Conti, a Singapore-based analyst at Australia & New Zealand Banking Group Ltd. “Though declines in government spending will have some negative effects on growth, these will be more than made up for by the boost in investor confidence brought about by fiscal consolidation.”
What this means in layman’s terms is that local monopoly businesses have a firm grip on the Philippine economy. It may appear to be a good thing because of the words “good fundamentals” – but it really isn’t because the “fundamentals” we are looking for are those that define a free market in perfect competition – not an oligopoly or a monopoly.
So going back to the issue of ratings – these ratings don’t mean much. Sure Filipinos approve of Aquino – but Filipinos also approve of a lot of retarded stuff.
Kettle Calls Pot Black
PLDT asks DoJ to probe Globe ‘monopoly’ in Ayala malls
A case of the kettle calling the pot black. Due to the economically restrictive constitutions whoever wins the Globe vs PLDT wars – Filipino consumers still lose. This episode is also a good time to observe the monopolistic outcome of protectionist economic policies – Philippine is a textbook example.
We keep complaining about how these companies services suck. It’s not about to change until these companies get true competitors. For all we know, Globe has shares of PLDT and PLDT has shares of Globe.
So while we are treated to the site of “competition” between Globe and PLDT – think again. This is a battle between Gozilla and King Kong – and YOU are the meal.
More of the Spratleys
Aquino’s motions are taken from the American Presidents’ playbook. The script goes like this:
When domestic concerns go south, in the case of the Philippines
- * corruption index is up
- * competitiveness index is down (FDI is minimal)
- * hunger incidence is up
- * remittances are down
- * utility rates are up
- * gini coefficient gets worse while there are more Filipino billionaires in the Forbes list
- * commodities are up
- * campaign promises not met – FOIA
- look for an external “crisis” that can take the attention away from these failures.
The Spratleys event is perfect. It has the elements of an external threat around which people can be rallied around. It is an event that can milked for all it is worth. Much like the sinking of the Maine in order to serve as pretext for a war against a competing power – the Spratleys has that kind of potential. But is it really the Philippines’ war? Or should we look at it as an opportunity to exercise diplomacy and build stronger bridges and relationships with our neighbors?
On the domestic front – coverage of the Spratleys is:
- a) Taking the heat away from the various performance failures of the Administration.
- b) Trying to position Aquino as “strong” and “decisive” (stood up to China)
- c) Serve as a market signal for increase in AFP defense spending
Will this really address the most pressing problem of the Philippines today – poverty? It will not. There are more pressing issues – namely, removing the 60/40 protectionist provisions and let a free market come into play.
Oh well, it’s just another week in the Philippines – the most irrelevant economy in Asia.
I would just like to add the whole PNoy fiasco with the Belgian Prime Minister. Apparently we’re on the verge of being blacklisted by the EU on its Overseas Development Assistance projects on top of paying 60 billion in damages because of the administration’s incompetence regarding the Laguna Lake dredging project.
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The dependence of the government on the earnings of the OFW, will not last that long. Soon Robots; or new Technologies will be developed. Making them obsolete. Saudi Arabia has already shown its reluctance to employ,Filipino OFW/Slaves…other nations, that are poorer than us, will take our place. Like some OFW/slaves from Africa.
The President has no working programs to solve the problems of the country. Not even a working program, for the nation’s development. His staff are composed of young people, who claimed to be bright, but inexperienced. The Mislang diplomatic gaffe on the vintage wine, is a good example. Spratley Island issue, is a way to divert our attentions, on his lack of accomplishments…it is a nonsense issue. He is a lazy and an incompetent President, who is good on blaming people. He just cannot accept responsibility…or act responsibly, as a head of state…
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