Philippine Economy in the Second Quarter of 2012 – Why There Are Good Reasons to be Hopeful

Every quarter of every year, the government measures the size of the economy. The technical term used for this measurement is Gross Domestic Product or GDP. In order to gauge the GDP, the government determines the market value of all goods and services produced in the country during the three-month period.

But the more interesting figure is not the GDP itself but how fast it is growing. In order to do that, the GDP of a single quarter is compared to the GDP of that same quarter a year ago.

Economic Growth

This increase in GDP is expressed in percentage. For example, the GDP of the Philippines for the second quarter of this year (2012) has been known to be 5.9% greater than the GDP for the 2nd quarter of last year (2011).

That’s what made government officials and the business community raving about the economy these past few days. Everyone is praising the Philippines’ good prospects for the future. This rate of GDP growth is among the highest in the region. Those whose job it is to predict economic growth had to revise their numbers upwards with this recent data.

This trend of economic performance is welcome news to investors. So long as the economy is expected to do well, people will feel confident that the money they invested will earn something in the future.

Trickle-Down Economics

And yet there are still far too many poor Filipinos struggling in this country. Prosperity is alien to so many who do not get any benefit from this GDP growth. It’s easy to claim that economic progress will trickle down. But not many will believe it especially those who find it hard to make ends meet.

It’s a challenge that our leaders have been trying to address. Making this growth inclusive will give the GDP numbers more meaning. It will start as soon as people can find jobs so that they won’t have to work overseas to make a living. Not just any job, but that which pay them adequately to live decent lives.

Fighting Poverty

Although our economy is doing great, no significant progress has come yet to lessen poverty in our country. Our ASEAN neighbors such as Malaysia, Thailand and Vietnam have been more successful in helping people overcome lack. Obviously, it’s comparably easier to generate more economic progress than it is to create jobs for people. This means that a GDP growth does not necessarily lead to fewer jobless Filipinos.

But I’m still hopeful, not because I believe the GDP numbers spell promises we should believe in, but because the government has taken steps which I feel will move us to the right path.

Some of these necessary undertakings include the following:

• Massive investments in physical infrastructure evident in the private-public partnership projects now underway.
• Promoting transparent and responsive leadership in every area of government (executive, legislative and judiciary).
• Fighting for education with the reform on primary and secondary schooling.
• Giving the very poor a much-needed lift through the Conditional Cash Transfer (CCT) program.

To be sure, not every area that needs fixing has results to show progress. But as long as the efforts are persistent and the strategy sound, we need only to have faith that it will work out for the better.

Photo Credit: Marufish (Creative Commons)