MANILA,  February 2, 2004 (STAR) DEMAND AND SUPPLY By Boo Chanco - Without an effective population program, it is difficult to see how our country can catch up with development in the next few decades. The national pie is hardly getting bigger, yet more and more are struggling to share the little available. On the other hand, it is perhaps time to take this population pressure as a given and work around it. One quick solution is to more systematically send our people away.

And they are going away, out of extreme need. According to the Philippine Overseas Employment Administration (POEA), close to eight million Filipinos are now working in 162 countries. We are now deploying new workers at a rate of 850,000-900,000 a year, or over a million a year, if we include the undocumented ones of about 25 percent more.

And we can only expect more Filipinos to leave in the next 20 years or so. The International Labor Organization found out that the outward pattern of migration only reverses when per capita incomes reach a threshold of $5,000. With our per capita income estimated at approximately $926, we are still a long way away.

This strategy of sending our workers abroad was resorted to during the Marcos years as a temporary measure to help relieve the unemployment pressure. But the inability of our economy to take off, thanks to lackluster national leadership, made this strategy permanent despite official denials.

But why deny? We should take control of reality! It is time for us to come up with a more organized effort to deploy our people in all corners of the world. People are our number one export product. Production of people is our number one cottage industry that requires no fiscal incentives. There should be active marketing coupled with an honest-to-goodness training effort to ensure highest quality.

I think it was the Filipina consul-general in Guangdong who told us that in China, they are not embarrassed to admit that they have to take this route of sending their people abroad to earn a living. As a result, the Chinese government has a more involved participation in the process.

The example I remember being cited is the deployment of Chinese nurses to Britain. Apparently, the Chinese government negotiates this on an official basis to cover everything from salaries to tenure to protect their nurses. The Chinese government also takes responsibility for training, including English language courses and homeward remittances of money.

In our case, the POEA steps in only in the final stage of deployment, after private recruiters have come to terms with the worker and the employer. Often, the worker is left to fend for himself or herself in a strange land. There is also no government program to train workers in skills that are of high demand abroad. There is no real effort to screen who gets to go abroad. That TESDA clearance is a money making joke. At the very least, we should stop the criminals and the criminally inclined from tarnishing the Pinoy image abroad.

There is no doubt that worker remittances from abroad have kept this country afloat through the years. Government estimates that in 2003, remittance inflows will reach $7.5-8 billion, an amount equivalent to roughly 10 percent of the countryís GDP. This represents significant buying power in a consumption-led economy like the Philippines.

From the larger perspective of the world, the strategy makes sense. A report presented to the World Economic Forumís Annual Meeting in Davos last week, raised profound questions arising from demographic trends sweeping the globe and their economic consequences. As much as 95 percent of all children in the 21st century, Davos conferees were told, will come from the Third World.

On the other hand, Europe and Japan are faced with a sharply declining population that is also ageing fast. Italyís retirees will outnumber its active workers by 2030. Over the long term, the study estimates that Japan would have to increase immigration 11 times over existing rates to make up for its low fertility rates. Thatís simply unacceptable in xenophobic Japan.

Labor shortages are being forecasted in some countries, with dire consequences on their economies. Among others, the supply of goods and services may not meet demand and standards of living in many countries in Europe and Japan. Assuming current demographic and economic trends hold, the study estimates the EUís share of total global output will shrink from 18 percent today to 10 percent in 2050. Japanís share would decline from eight to four percent.

The United States stands out as an exception in this trend of declining populations among developed countries. This is because of immigration. Americans may complain about their somewhat more liberal immigration policies but immigrants have contributed greatly to sustaining their economy and keeping future prospects brighter than Europe.

In fact, the Davos study recommended remedies governments and business have at their disposal. The list includes increased immigration. They also need "to develop ways to tap surplus labor pools in developing countries through greater economic integration than ever before." They must be referring to the growing trend for outsourcing.

The moral lesson is simply, we can no longer think in terms of narrow nationalities and countries anymore. Nations must accept increasing interdependence and erosion of sovereignty. Borders must be opened not just to manufactured goods and services but also to migration. The developed countries need our teeming excess people as much as we need to send them away to balance demands on our resources in the third world. Globalization will force us to think in terms of humanity, not nationalities.

And yes, Pinoys will cover the world, whether the world wants us or not.

Plunging Peso

When asked to comment on the plunging value of the peso, President-to-be FPJ replied: "Nagkakaroon lang ng chain reaction Ďyan. Pag nagbago ang dollar sa ibang lugar, may chain reaction yan."

PhD Economist President GMA said just about the same thing, blaming the "recovery of the US economy" for the pesoís decline.

Ano ba yan? Pareho ba ang economic advisers nila? Tagalugin na natin at baka sakaling basahin ni FPJ. Bakit yung Thai baht hindi sumasadsad? Dapat affected din ang baht ng "chain reaction" at ng "US recovery". Ginagawa pa tayong tanga ni Ate Glo at FPJ.

Sa totoo lang, demand and supply lang yan. Marami sa ating mga kababayan ay nagpapanic buying ng dollars kasi walang tiwala sa stability ng piso o kaya sa pamamahala ng ating bayan. Worried sila sa budget deficit, sa lumalalang peace and order at sa walang pag-asang pamumulitika. Kaya sine-safety na nila ang pera nila sa pamagitan ng pagbili ng dollars. Kahit yung mga OFW, tingi ang pag-convert nila ng dollars nila sa piso... yung para sa pang araw araw na pa-ngangailangan lamang. Pag malakas ang demand at wala masyadong gustong magbenta ng dollars, bagsak ang piso. Simple lang, di ba?

If the choice is just between these two, who canít even properly explain something out of Economics 101, there is no hope... we are all screwed.

Your Choice

Hereís something from Sonny Mendoza.

A pompous minister was seated next to a Texan on a flight to Dallas. After the plane was airborne, drink orders were taken.

The Texan asked for a whiskey and soda, which was brought and placed before him.

The flight attendant then asked the minister if he would like a drink.

He replied in disgust, "Iíd rather be savagely raped by brazen whores than let liquor touch my lips."

The Texan looked at the minister, then handed his drink back to the attendant and said, "I didnít know we had a choice."

Boo Chancoís e-mail address is

Reported by: Sol Jose Vanzi

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