By Hannah Torregoza
The vicious cycle of smuggling is dragging the Philippine economy down, Senator Richard Gordon, chair of the Senate blue ribbon committee, lamented on Monday.
Gordon said with the way the Bureau of Customs (BOC) is failing to address revenue leaks, the government’s target revenue is never achieved and ultimately, is harming the country’s economy.
As far as he is concerned, Gordon said the cycle starts with massive smuggling done through either undervaluation, misdeclaration, fake consignees and fake goods, and “alert-pay-lift” system and port congestion that occur within the BOC and the country’s ports.
Because of this, he said domestic manufacturers are affected as they cannot compete with cheap smuggled goods, ultimately resulting to closure of businesses, decline in output and jobs and new businesses, unemployment, low wages, and forcing individuals to “seek for greener pastures abroad” as an overseas Filipino worker (OFW).
Due to smuggling and lower target collections, Gordon said this then renders the government unable to properly finance infrastructure projects, provide for better and schools and health facilities, and provide higher salaries for government employees.
As such, the government is also unable to strengthen the military and address crime and drug problems.
The cycle, Gordon said, continues and results to increased taxes as consumers ultimately have to contend with higher prices of gasoline and basic goods, and the loss of their purchasing power.
“This is what we call the vicious cycle of smuggling,” Gordon said at the resumption of the Senate’s inquiry into the P6.4-billion worth of smuggled shabu from China.
“Domestic manufacturing can’t compete with cheap smuggled goods. It also weaken our foreign direct investment flows,” he further said.
“Kaya magtataka kayo, ni pako hindi na natin ma-produce sa ating bansa (that’s why you will wonder why we can’t even produce nails here in the country),” he pointed out.
To elaborate, Gordon held up a pair of crayons, one brand, which is cheap but contains the deadly chemical lead while the other is a better product. He pointed out that consumers tend to purchase the cheaper ones.
“I hope we’re learning lessons here. This is the job of government,” Gordon told BOC officials who were present at the hearing.
“If government fails do its job, we lose jobs, we get bad products, we pay more for everything. Ang yumayaman lang ay yung mga smuggler, (Those who are getting richer are the smugglers),” he pointed out.