It's the Economy, Student, part 3 of 4

This is the full text of a paper written by former president and current Pampanga representative Gloria Macapagal Arroyo which was released to the media yesterday during a press briefing at the Manila Hotel.

[I wrote this article on and off in my spare time during my house recuperation, re-hospitalization and hospital detention from October to December 2011.] 

Part 3 of 4

Infrastructure


Infrastructure strengthens our competitiveness and enables us to attract new levels of jobcreating foreign direct investment. Infrastructure investment not only drives economic growth, but also creates a more efficient, competitive economy, by improving productivity and lowering the costs of doing business.


I am alarmed that the pace of infrastructure build-out has slowed dramatically under this Administration, with some projects even being cancelled outright for no good reason—such as the earlier-noted flood control projects in Central Luzon—and our country being sued by investors. At a time when we should be wooing their money, we are inviting litigation from them instead. This kind of flip-flopping may help explain the tepid investor response to the Administration’s flagship public-private partnership (PPP) program, where only one project has been awarded after all of eighteen months.


I was heartened to hear the President announce recently his willingness to resume government infrastructure spending next year. However, one cannot help but notice the timing, so close to the upcoming 2013 election campaign.


Land productivity


In my first State of the Nation Address in 2001, I said that the first component of our national agenda should be an economic philosophy of free enterprise appropriate to the twenty-first century, while the second should be a modernized agricultural sector founded on social equity.


Within a couple of months after taking office in January 2001, I personally conducted Cabinet meetings to implement the Agriculture and Fisheries Modernization Act of 1995, which had never been implemented for lack of funds. After several discussions with selected department secretaries as well as heads of government banks, we uncovered budget items and available credit to channel more than P20 billion a year to provide fertilizers, irrigation and infrastructure, extension services, more loans, dryers and other post-harvest facilities, and seeds and other genetic materials to our farmers and fisherfolk. This was perhaps the biggest reason for the decline in poverty that was posted during my first few years in office.


The current Administration originally fixated on the single goal of achieving self-sufficiency in rice by 2013. I too wanted to achieve rice self-sufficiency, but I knew the odds were tough. Since the Spanish period we’ve been importing rice. While we may know how to grow rice well, topography doesn’t always cooperate. Nature did not gift us with a mighty Mekong River like Thailand and Vietnam, with their vast and naturally fertile river delta plains. Nature instead put our islands ahead of our neighbors in the path of typhoons from the Pacific. So historically we’ve had to import 10% of our rice, and so I took care to keep our goals for agriculture wideranging and diversified.


Recently the Administration seems to have retreated from the original objective of rice selfsufficiency by 2013. In its place, do they have an alternative vision in mind for our all-important agricultural sector?


The real challenge in this century is broader. The real task at hand is to make the finite land that we have planted to agriculture ever more productive, through agricultural modernization founded on social equity.


Higher productivity from farm lands is critical for our development. By making more food available at lower prices especially to our poor, we are effectively bringing down the required level of real wages in our country—already among the highest in the world, according to UP Professor Manny Esguerra—and helping to make our manufacturing industries globally competitive again.


As for social equity, being the daughter of the late President Diosdado Macapagal, the father of land reform in our country, I am gratified by the evaluation of one of my favorite Economics teachers, UP Professor Gonzalo Jurado: “The Comprehensive Agrarian Reform Program, to the extent that it is a land distribution program, can now be described as having almost completely succeeded in attaining its goal. [CARP] should now be a developmental program aiming explicitly to raise farm productivity…so that the country as a whole will benefit from the tenurial rearrangement.” And of course it is the landowners who must set the example of compliance with the law in order to allow the rest of us to move forward—such as the Arroyos in my husband’s family, who voluntarily submitted long ago to land reform even without an order from the Supreme Court to do the right thing.


See Part 4 of 4