BOO CHANCO: IS FPJ THAT BAD FOR THE ECONOMY?
MANILA, March 24, 2004 (STAR) DEMAND AND SUPPLY By Boo Chanco - Some may say, how could I even ask that question! Isnít it obvious? Well, I am not sure anymore who hurts the economy more: Ate Glo or FPJ. True, the pesoís decline accelerated after FPJ announced his candidacy. But the peso was on a downward trend for months before that fateful day.
True, foreign investors and foreign creditors became nervous when FPJ and running mate Loren said something about rescheduling debts if they win. True, FPJ has yet to get an appreciation of the basics of economics even if he is getting the best tutoring from the countryís top economists.
But as Toti Chikiamko, a political economist who writes a column for another daily puts it, he would rather have the high school dropout than the PhD in Economics who turns her back on basic economic principles.
Toti reviewed our economic situation under Ate Glo and concluded that she is more dangerous to the economy than the high school dropout.
"From a budget deficit of PHP134 billion in the last year of the Estrada administration, the annual budget deficit now reaches PHP200 billion. This doesnít count the losses of government-owned and controlled corporations like the National Power Corp., which is expected to hit PHP135 billion this year, or three percent of GDP.
"In terms of perception of corruption, the image of the Philippines as a corrupt country has deteriorated significantly in the past three years of the Arroyo administration. The Global Corruption Report prepared by Transparency International graded the Philippines with an index of 2.9 in 2001. This fell to 2.1 in 2003 (the lower the index, the more corrupt a country is). The Philippines fell into the same category as Pakistan, Romania and Zambia.
"The Global Competitiveness ranking of the Philippines has fallen under the Arroyo administration. A World Economic Forum report ranked the Philippines 36th out of 58 countries in the year 2000. In the latest Global Competitiveness Report, the Philippines ranked 66th out of 102 countries. The Philippines has more debt, more unemployed, more crimes and is perceived to be more corrupt and less competitive now than when President Arroyo took over."
Last week, I was with a group of foreign businessmen, many of them long term investors in the country, and Totiís analysis was echoed. There was this sentiment that the country cannot survive six more years of Ate Glo. Having experienced her type of leadership over the past three years, they hesitate to give her the benefit of the doubt that she would drop her populist ways after she gets her own mandate to be president. Her populism has increased the countryís business risk because of greater unpredictability.
Even as I am still inclined to choose between Raul Roco, Ping Lacson or even Brother Eddie, I have also been thinking that maybe we need someone who is this popular and deeply trusted by the masa to make the difficult decisions about the economy and get away with it. Anyone else would be suspected of working for the interest of the elite.
Anyway, whoever wins in May will have no choice but to go the straight, narrow, thorny path of taming the fiscal deficit, creating enough confidence to keep the exchange rate from falling fast and furiously and attract investments. Or at least, keep the local investors with their local capital from fleeing.
This is why when educated people, who should know better, tell me they think Roco is the best choice but they will vote for GMA because they donít want FPJ to win, I wonder if they have stopped using their brains. As Toti Chikiamko says, Ate Gloís PhD in Economics means nothing because she sacrifices economic principles before the altar of political expedience.
My problems with FPJ, that keeps me from going for him, are the old Marcos era political clowns around him, his lack of political experience and the dramatically conflicting cast of economic advisers trying to win him over. It makes me wonder who would get his ear better, Toti Chikiamko and Raul Fabella or Tito Guingona? That makes a whale of a difference. Free trade is totally antagonistic to protectionism, for one thing.
I have only had one face-to-face encounter with FPJ. In that interview, he impressed me that he knows enough about globalization to know that it is here to stay and it would be futile to fight it. He said we have to work to be competitive instead. Maybe he just got a briefing before we talked and was parroting a rehearsed line. But he also made me think he knows more about the realities of the world today than Tito Guingona.
As I said, my gut feel tells me the country would be better off with one of the next three candidates. But if my choice is only between Ate Glo and FPJ, Iíd pick FPJ. Knee jerk reaction from investors may initially be bad but I am sure he can turn that situation around pretty quickly, if only because he represents change.
In answer to my question, FPJ isnít going to be that bad for the economy. Those who were initially going for Roco but have shifted to Ate Glo out of fear of FPJís economic impact, need not be afraid. I suspect that if you take away the "fear of FPJ" factor, the race is still wide open to include Roco among those who could win this May. But even if FPJ wins in the process, that is still a better and more hopeful outcome than the status quo.
Business Not Politics
It is unfortunate that some politicians are trying to give political color to purely business matters related to Dolphyís relationship with ABS-CBN. I am no longer involved with the networkís day-to-day business and therefore do not have first hand knowledge of the circumstances. But I am reminded of a similar case some years ago when I was still there.
Tita Cory was President and Kris Aquino had a show on ABS-CBN. The show started to show signs of losing the ratings and we had to make the difficult decision of what to do about it. Normally, the show should be axed because a show with a weak or weakening rating would allow competition to catch up and even gain on us. But Kris is the Presidentís daughter.
Showbiz is a tough business and the show of Kris was axed, even if she is the Presidentís daughter. We tried to explain to mother and daughter why it had to be done. There were some "hinanakits" for a while. But we all know Kris came back to ABS-CBN with other shows that rated well and earned her bundles of cash.
I suspect, but canít say for sure, the same thing happened with Dolphy. The time slot of his show had been shifted a little too often lately, a sure sign of rating problems. But Dolphy is an institution and has a long and deep relationship with ABS-CBN. I am sure the network is not about to leave him high and dry. Malalim ang samahan ng mga Lopezes at si Dolphy. ABS-CBN and Dolphy got to where they are today faster because of each other.
I am not privy to what is going on between Dolphy and ABS-CBN right now. All I know is, tough decisions must always be made based on the ratings. After all, GMA 7 is huffing and puffing, trying to blow the ABS-CBN house down and nearly momentarily succeeding to blow away a window or two. Dolphy, the veteran showbiz personality, knows how tough the business is.
When he was honored with a Lifetime Achievement Award by ABS-CBN last year, he recalled that he had so many ups and downs in his career and was revived by ABS-CBN a number of times. He said he was surprised when, during one of those down moments, Geny Lopez came along offering him a show that eventually made him. In showbiz, they know, weder weder lang yan.
As for Dolphyís inclination to support FPJ, I am sure the Lopezes couldnít care less. I have worked for the Lopezes for years, in many capacities, from editor of the Manila Chronicle to reporter and then VP for News and Public Affairs of ABS-CBN and never have they imposed on me their political views. Don Eugenio might have used the Chronicle for political purposes but his children didnít have the same inclination about using media they own in like manner. I know it is hard to believe because of their image, but they are terribly non political. Maybe thatís their mistake.
Just to give a lie to the accusation about a deal between them and Ate Glo, read this column again from the first paragraph. We have freedom to think and express ourselves in the Lopez Group. Give the Lopez family that much credit.
Reported by: Sol Jose Vanzi
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