In 2011, the first year of Noynoy Aquino’s administration, this growth slowed to just 3.7%. Disappointing!
What do these numbers mean?
In simple terms, these are estimates of how much the economy changed for a span of one year. A lot of experts are saying that growing economies would translate to more prosperous living conditions for the people as a whole.
But in reality even if the economy grew, many of us may not feel better if the growth was too little. We could still be earning as much as we did and spending as much as we did. Some people would feel better but many others won’t.
Of course, if the economy were consistently growing year on year at a faster rate, we ought to be affected sooner than if the economy was growing slower.
This could mean more jobs created, more business earning profits, more products manufactured, more investments on infrastructure, increases in salary, etc.
So really, we should be a little concerned when the economy is not performing to its full potential. It will affect us one way or another.
A cause for concern?
But should we be concerned with the dismal performance of the economy specifically that which occurred in 2011?
My take on this is that we should at least understand what happened in 2011 to assess its significance.
Criticisms have been flying around that our President is too intent in fulfilling his campaign promise of “matuwid na daan” that he is now neglecting his job to take care of the economy.
I don’t really know if that’s true or not but I do know that the government’s decisions and actions affect the economy.
Economists say that 2010 was a hit because it was an election year with election-related spending driving up growth while 2011 was a flop because the government spent too little.
This tells me that the government has to do its part to spur the economy. And one of the main reasons that the Aquino administration was too slow to act on this is because it wanted to do away with the old corrupt system of executing projects and create a new one that is honest and efficient. I believe that took some time for them.
Whether it was too long a time or not is a matter of judgment. The good thing is that these projects have started to roll-out by the end of last year. There’s no reason for it to falter once more.
These projects are doubly advantageous for being not only stimulating for the economy but also for improving the standard of living everyone would experience. That’s because these projects, which the government calls Public-Private Partnerships (PPP), are all about infrastructure development.
Investing in infrastructure should make it easy to do business thereby multiplying the beneficial effects to the economy later on.
Philippine Economic Outlook
But the bigger question really when it comes to the economy is whether or not we should be optimistic about it. After all, optimism or the lack of it drives our decisions to act.
I would argue that our having a popular president who is doing the right thing to rid the country of corruption as much as he can is a very good thing for us. When a business environment is seen to protect individual rights and properties, that economy will be a magnet for new players to join in.
This alone is a cause for optimism.
But if you want a more aggressive projection you need only to know that HSBC, the international bank, thinks that the Philippines will become the 16th largest economy by 2050.
This is a leapfrog 27 places from where it currently is today. They think that the Philippine economy would grow for an average rate of 7% annually for the next 40 years.
If that’s not optimistic, I don’t know what is.
