OF SUBSTANCE AND SPIRIT
Diwa C. Guinigundo
It’s not news anymore, that latest Pulse Asia’s “Ulat ng Bayan” survey that was conducted between June 24 to 27 with some 1,200 respondents showing that the most urgent concern among Filipinos was controlling inflation, or the rate of increase of consumer prices. At the time, the Philippine Statistical Association (PSA) reported an inflation rate of 6.1 percent for June, the highest since October 2018.
For July and August, consumer prices continued to destroy buying sentiment by surging at 6.4 percent and 6.3 percent, respectively. The reality of high prices must have hit hard on the civil society as it started to ask why prices have been galloping since the early part of 2022, and all we could cite is the tight energy and food supplies following the protracted hostilities in Eastern Europe and the unfriendly OPEC production cutbacks. Then we all realized that up to this time, we have failed to address the fundamental issues surrounding such basic commodities as sugar, onion, and even salt. It must be embarrassing but it shows we don’t have a comprehensive plan yet in agriculture, food security and consumer welfare. Surely, there were previous brave attempts in the past, but we continue to await their outcome. One year ago, inflation also topped the public’s major concern with the performance of the Duterte administration, giving anti-inflation measures the lowest approval of 37 percent compared to the highest approval of 74 percent assigned to fighting criminality.
On the other hand, from September 2020 approval rating of 77 percent, fighting graft and corruption was downgraded to 52 percent due likely to the hype of the Senate Blue Ribbon Committee investigation into the unconscionable Pharmally scandal involving billions of pesos in public money spent on overpriced, spoiled health supplies, some of them actually undelivered. Short of the required number of senators to approve the committee report, it gathers dust in the Senate archives.
Justice is quite elusive to our own people who paid those squandered taxes as if there was no pandemic and no lives were sacrificed.
But governance issues like graft and corruption would not to be laid to rest.
Early this year, Transparency International’s corruption perception index showed some deterioration in the Philippines’ rank from 2020’s 115th among 180 countries to 117th for 2021. Of the top 10 ranking countries, Denmark was 1st with a score of 88 for both 2020 and 2021 while Germany was 10th with a score of 80 for both years, too. The Philippines scored only 34 out of 100 in 2020 and 33 in 2021.
Among the 10 ASEAN member countries, the Philippines ranked only higher than Cambodia, Laos, and Myanmar.
And just recently, corruption was identified as the number one factor that “could delay Philippine economic recovery.”
Who identified this game changing factor in the country’s economic recovery?
They were the top 119 chief executive officers in the Philippines. While confident of higher revenue growth in the next 12 months up to the next three years, these CEOs were skeptical about the country’s economic recovery if corruption is not curbed. Corruption has social impact and could derail good governance. This was the major finding of PwC Philippines, as Knowledge Partner for the Management Association of the Philippines (MAP) International CEO Conference, in its July-August survey with the theme “The Wins of Change: Thriving in a World of In-Between.”
They also identified the potential risks from lower investments, political uncertainty, and yes, uncontrolled inflation and rising oil prices.
PwC Chairman Emeritus Alex Cabrera also admitted that “people are more aware now…just reading from the news. Even during the height of the pandemic, there was a lot of corruption incidents from the agencies that were supposed to take care of our people.” As a result, the Philippines has been in the cellar when it comes to ease of doing business and business competitiveness.
True, the CEOs pinned their hopes on such growth drivers as infrastructure, domestic consumption, and public spending, identifying the US as the most important trading partner followed by China and Japan.
What must also be obvious was the fact that firms’ performance has remained uneven. Many have not recovered from the pandemic, not everyone in the survey was gung-ho about surpassing pre-pandemic revenue levels in the short run. Thus, CEOs would like the government to prioritize agriculture and food security, education and the health care system.
The risks of the pandemic and the corresponding physical lockdown were not lost on the CEOs. They recognized the impact of continuing economic scarring on talent constraints and adaptability to work and technological innovations.
Surprisingly, majority of the respondent CEOs have yet to consider sustainability practices. Less than half of them have incorporated climate change and environmental issues on strategic risk management and even less have explicitly embraced such sustainability practices.
If there’s scarring from the pandemic that continues to emasculate our efforts to shape up and recover our lost economic ground, corruption also imposes long-lasting scarring effects on the civil society and business activities. Those corruption incidents involving the purchases by the Department of Health of anti-Covid vaccines and protective gears as well as by the Department of Education of computers and other learning devices in the last two and a half years of the pandemic could only be revolting. Centralizing such purchases to the procurement service of the Department of Budget and Management effectively weaponizes the bureaucracy against the poor recipients of social services. Trust and confidence in the government could only decline.
No doubt, as Jawaharlal Nehru once upon a time quipped, “every little thing counts in a crisis,” but corruption makes everything big especially in a crisis. There is more reason for those in government to notice and act on them.