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Senators on GDP
growth: Why can’t we feel it?
By AUREA CALICA and PAOLO ROMERO
The Philippine Star
It may be clear as day in official statistics, but why can’t many
Filipinos feel the record growth in the economy?
Senators raised the question on Friday in reaction to President Arroyo’s
glowing report on economic growth.
Mrs. Arroyo on Thursday reported that based on latest data released by the
National Statistical Coordination Board, the economy grew by 7.5 percent
in the second quarter – the fastest rate in 20 years – as government
spending and private consumption swelled.
But some senators said the economic growth is almost illusory and hardly
felt by many Filipinos.
Senate Majority Leader Francis Pangilinan said the reported growth was “unbelievable”
and that it would be unsustainable if it were true.
“We have reached seven percent before under former President Fidel Ramos
but until we ensure effective governance, we cannot sustain this,”
Pangilinan said in a statement.
“The two to three percent who are rich perhaps can feel it but most
certainly not the 80-plus percent who are in the middle and low income
brackets, the man on the street,” Pangilinan said.
Sen. Panfilo Lacson said news of the record growth was received with
skepticism because “poverty is still at a very high level.”
“I don’t know where she’s coming from – her basis for saying the
economy is growing,” Lacson said.
Sen. Manuel Roxas II said it might be very hard to sustain the growth
because it is “primarily consumption-driven.”
“What we need to see is growth coming from production of goods and
services in order to realize sustainable growth,” Roxas said in a
statement.
“As far as Juan de la Cruz is concerned, GDP (growth domestic product)
growth means nothing if it does not directly relate to his own wallet,”
Roxas said.
“The challenge the government faces is to turn the upbeat headlines in
the newspapers to food on the table, to better jobs and income, and to
more affordable goods and services,” he added.
While key sectors like industry and business process outsourcing posted
growth during the period, Roxas said he is concerned over the slowdown in
agriculture growth from 6.7 percent in the same quarter last year to 3.9
percent this year.
“This is the sector where the country’s poor earn their living, and we
should immediately focus on establishing sustainability of agriculture
production,” he said.
Senate President Manuel Villar described the 2nd quarter GDP growth as “impressive”
but stressed that “an increase in employment should complete the
picture.”
“A jobless growth,” he warned, “would blot out and reduce the impact
of any GDP growth.”
“For the man on the street, more jobs and lower or stable prices of
basic goods are signs of the good times,” Villar said.
“The challenge, therefore, is to translate upward economic movement to
the expansion of the labor market,” he said.
In a statement, Villar said the 2nd quarter economic data captured only a
month, April, of the job picture for the period.
Reported unemployment rate for that month was 7.4 percent while
underemployment was as a staggering 18.9 percent.
But critics have claimed that joblessness could be higher as the new
government formula in counting the unemployed excludes those who have
given up job searching.
Still, in real terms, 2.691 million were without jobs and 6.381 million
were working part-time and whose pay presumably was not enough to sustain
a decent living when the last survey was taken, Villar said.
“It is this army of nine million unemployed and semi-employed who should
benefit from the rosy economic picture which the government is painting,”
he said.
“They should be the bellweather if indeed growth is trickling down or we
are just being tricked into believing that it is,” Villar said.
By region, Metro Manila registered the highest unemployment rate of 12.5
percent, followed by Central Luzon with 10.2 percent.
He said the most disturbing aspect of the job picture was that half of the
total unemployed belonged to the 15 to 24 age group.
Four out of 10 unemployed had attended college, “meaning, higher
education is no longer a passport to assured employment,” Villar said.
Sen. Richard Gordon, on the other hand, said the government wouldn’t
dare manipulate the economic figures because of possible international
backlash.
“Instead of questioning the figures, we should all help to sustain it.
If not, we are really doomed to become poor,” he said.
The Kilusang Mayo Uno in Southern Mindanao also laughed off Mrs. Arroyo’s
economic report, saying “it proved only how detached she was from the
Filipino people.”
KMU’s Romualdo Basilio said the reported growth doesn’t reflect in the
standard of living of many Filipinos. “Sadly, the workers have not felt
the effect of such growth,” he said.
“Why haven’t the wages of workers been increased correspondingly?”
he asked. “Then this is an incongruent growth.”
Meanwhile, Malacañang hit back at critics for questioning the credibility
of the second quarter growth figures.
In a statement, Ricardo Saludo, secretary to the Cabinet, took a swipe at
media in general for challenging the growth figure.
“Our government officials worked hard in collecting and analyzing the
data on the economy. Let us not belittle their hard work just because of
some text messages and criticisms that are without any basis,” Saludo
said.
“Before we judge one another, let us first examine the basis,” he
said.
“Regarding the question of whether or not the public is feeling the
economic progress, we hope the media would also present the hundreds of
thousands who were employed, who were given homes, got electricity, health
care and other blessings and not just those who have not yet benefitted
from this progress,” Saludo said.
Increased spending
Malacañang promised on Friday to spend massively on social services and
infrastructure to sustain growth and make it reach the grassroots.
Budget Secretary Rolando Andaya Jr. said the proposed P1.227-trillion
budget for 2008 “has been designed to boost growth drivers and seep down
to the grassroots the benefits of higher economic growth as exhibited by
the 20-year high 7.5 percent GDP expansion in the second quarter.”
He said the government would spend P48.4 billion more for social services
next year, or P368.88 billion.
Economic services, on the other hand, would be given P287.45 billion, a
P45.2 billion jump from this year’s P242.2 billion, he said.
Agriculture, agrarian reform, trade, roads, water and energy constitute
economic services.
Andaya said infrastructure expenditures would be increased from this year’s
P94.6 billion to P115.96 billion next year.
Four agencies, he said, will undertake road building: the Department of
Public Works and Highways, the Department of Agriculture, the Department
of Agrarian Reform, and the Autonomous Region in Muslim Mindanao.
The DPWH will build more than 2,300 kilometers of roads for P60.4 billion,
while the DA with a budget of P7.1 billion will construct or maintain some
3,100 kilometers of farm roads.
DAR will spend P831 million for road networks in agrarian reform
communities while ARMM will spend P1 billion for new road construction.
Local governments are programmed to spend P1.48 billion for new community
roads, Andaya said.
More than P7 billion is also being eyed for airport modernization,
according to the budget chief. He said the education department hopes to
spend P146 billion next year.
“This would allow the government’s biggest bureaucracy to hire10,000
teachers, build 12,100 classrooms, buy 35.1 million textbooks, train
172,000 teachers, send 711,750 scholars to private schools, start
kindergarten classes for 1 million five-year-olds among other initiatives
that would allow it to provide quality education to 17.6 million
students next year,” he said.
The health sector will also get a boost in spending.
“Big-ticket items in this sector are P3.5 billion allocation to place
23.5 million persons under PhilHealth coverage, the five-fold hike to P1.2
billion of the budget for family health, the doubling of the TB budget to
P280 million, half a billion pesos for 74 million vaccine shots to women
and children,” he said. With Marvin Sy and Edith Regalado
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