OF SUBSTANCE AND SPIRIT
Diwa C. Guinigundo
There must be another way of appreciating this issue of presidential visits to other countries supposedly to foster and maintain relations and on the sides, ink investment agreements with their business community. The two presidents before President Marcos, Jr. had their shares of foreign travels, too, in the first six months of their incumbencies. After all, heads of states are entitled to do official, state or working visits.
President Aquino III travelled three times. Once, in the United States from Sept. 20-26, 2010 to attend the UN General Assembly and meet with US’ political and business leaders. On Oct. 26-30, he flew to Vietnam to attend the ASEAN Leaders Summit, and some bilateral talks with Vietnam’s leaders. On Nov. 13-14, Aquino attended the APEC Economic Leaders Meeting in Yokohama, Japan.
Aquino logged 40 trips to 24 countries, some a few times, including those he made to the United States, Japan, and Indonesia. He never visited Beijing in the six years of his presidency.
President Duterte, who was averse to foreign travel, registered seven international trips to 11 different territories. Laos and Indonesia were first on Sept. 5-9, 2016 to attend the ASEAN Leaders Summit and the 11th East Asia Summit. On the sidelines, he held bilateral meetings with the other APEC leaders. He proceeded to Indonesia where he discussed with President Widodo the issue of Abu Sayyaf and maritime security.
Duterte visited Vietnam on Sept. 28-29, coinciding with the 40th anniversary of diplomatic ties between the Philippines and Vietnam. Brunei and China on Oct. 16-21 were his next destinations. Duterte later visited Japan on Oct. 25-27; Thailand and Malaysia, Nov. 9-10; Peru, Nov. 18-20 to attend the APEC Economic Leaders Meeting; and finally, on Dec. 13-16, in Cambodia and Singapore.
In his six years as president, Duterte completed 21 international trips to 20 countries with several visits to China, Thailand, and Japan. While Aquino never stepped on Beijing, Duterte refused to visit Washington, DC.
President Marcos, Jr. was somewhat lighter on foreign trips than President Duterte. He made six trips to seven countries in his first six months in office. His first trip was to Indonesia and Singapore from Sept. 4-7, 2022. He held bilateral talks with President Widodo while he met Singapore’s leaders and their potential investors.
The US was a working visit on Sept. 18-24, addressing the UN General Assembly and meeting with some current and former heads of states. His third was an unannounced visit to Singapore where he attended the 2022 Singapore Grand Prix on Oct. 1-3.
He attended the 41st ASEAN Leaders Summit in Phnom Penh on Nov. 9-13, and held bilateral discussions with the other heads of states. He had a working visit to Thailand through his participation in the APEC Summit with some bilateral talks with delegations from other APEC members. He was also received by Thailand’s royalty. Marcos, Jr’s last trip for 2022 was to Belgium on Dec. 12-14, to attend the ASEAN-European Union Commemorative Summit.
Our suggestion to stop making a big issue out of these foreign trips is anchored on the entitlement of heads of states to travel abroad, meet with their foreign counterparts and expand their countries’ economic opportunities. But let’s avoid extreme stretch. Justifying these foreign trips by invoking the number of investment pledges from the host economies is not very smart. It’s too weak to rationalize a big delegation, or the presence of some entertainers. They are not covered in the entitlement for sure. They are a no-no in doing costs and benefits in the use of public money.
Attracting foreign direct investment (FDI) during a presidential visit is hardly optimal. Only a paltry of these pledges actually materialize. The literature on why the Philippines has failed to attract good FDI shows a consensus on such factors as bad infrastructure, prohibitive power costs, slow broadband connections, regulatory inconsistencies, and bad governance. These cannot be cured by a presidential visit which could at best, promise that specific government programs are being undertaken or a task force has been formed. That demands strong faith. Weak FDI translates to inability to manage the economy well.
This is confirmed by an interesting paper by the BSP Research Academy in December 2021 written by Hazel C. Parcon-Santos, Maria Rica M. Amador, and Marie Edelweiss G. Romarate. They observed the disparities in FDI in Indonesia, Malaysia, the Philippines, Thailand, and Vietnam. Some 15 source countries were covered for the period 2009-2019.
This BSP paper found that not one or two factors could explain investor interest, but a number of both economic and non-economic factors.
The paper argued that “sovereign credit ratings have signaled effects for FDI, which bodes well for governments that are actually working on measures to improve credit ratings, with the end goal of enhancing an economy’s efficiency and competitiveness.”
The other elements for attracting FDI include ease of cross-border trading, quality of human capital, liberalizing FDI restrictions and sound public governance. Contrary to claims of some, reducing income tax may help but it is not an absolute in getting more FDI. Foregoing potential tax revenues is like foregoing the funding for better infra support, education, and health. These tasks are not done in the plane or in some posh hotels in other countries.
While heads of states are entitled to travel abroad, not everyone of them exercised such privilege. China’s Mao Zedong concentrated in building their economy and society. Except for some brief visit to Soviet Union in the 1950s, he never set foot on any foreign country. He must have realized the gravity of building a nation, and that time spent on the plane was better spent on laying the groundwork for a stronger and more inclusive society.
He was succeeded by Deng Xiaoping, who was considered the architect of modern China, and who travelled only in France to study, the Soviet Union for further exposure to communism, and the US to open diplomatic relations. Like Mao, he believed people could do great things observing the advanced strides in other economies. He applied what he saw in Thailand, Malaysia, and Singapore. From there, he poured out his spirit in modernizing China’s economy, agriculture, scientific and technological development, and national defense. This is one way of looking at those presidential visits.
And the rest should make a different story.