One economist expects President Ferdinand R. Marcos Jr. to adopt a “back to basics” approach into his second year in office.
Rep. Joey Salte Salceda, chairman of the House Ways and Means Committee, said the country embarked on a large-scale project only recently before the country’s more successful neighbor achieved its national development aspirations, before the country began to have the financial slack.
“President Marcos’ commitment to doubling down on the previous administration’s infrastructure push gives us the opportunity to revisit some elements of national development that are currently lacking,” Salceda said in a page six paper.
Salceda noted that the country’s main international gateway, Ninoy Aquino International Airport, has not built a new passenger terminal in 15 years, while “all other ASEAN-6 countries have built new airport terminals in the last decade.”
“This clearly underscores the need for a new international gateway that can serve not only passengers but also the export and re-export sector. That is why I argue that Bulacan Airport and its surrounding master-planned eco-zone are the cornerstone of our national ambitions,” Albay said.
Salceda also emphasized that the country has the smallest major port in the region.
“Port of Manila (including North Port, South Port and MICP)” [Manila International Container Port]with only 34 berths and piers, the land area is the smallest in the region,” Salceda added.
“The size of our main port is not of the type that can compete with other manufacturing centers in the region on scalability or aspire to become an international trade hub,” he added.
On rail infrastructure, Mr Salceda said, “Our rail system is the shortest among the major Asean countries, making our country less competitive in terms of logistics costs and hindering meaningful interconnection between our manufacturing centers and ports of entry and exit.”
On maritime trade, Salceda noted that Vietnam has already taken over the country in shipbuilding, where the Philippines once dominated in the region.
“Shipbuilding capacity is the strongest indicator of our ability to connect our islands together, as well as our ability to project economic and trade forces onto the global economy. Considering Vietnam’s own shipbuilding activity has declined sharply since 2019 due to the closure of the Hanjin Shipyard, Vietnam completely overtook our country in shipbuilding tonnage last year,” he said.
Salceda added that the country has one of the largest power shortages in the region, and power costs are rising.
“We also have alarming shortfalls in our electricity supply, which largely accounts for our relatively high electricity costs. , will be the sixth largest power plant in the country after Santa Rita and the only 500 MW plant that does not use fossil fuels,” he said.
Salceda said the government should not only fund larger infrastructure projects, but also larger infrastructure items.
Salceda said these challenges will require “not only massive total spending on infrastructure, but also large-scale single-item projects on these key areas of national development.”
“Funding does not have to come from the state treasury. That is why the enactment of the Maharlika Investment Fund and the Public-Private Partnership Act is an important step towards harnessing underdeveloped private sector resources for infrastructure,” he said.
Aside from foreign direct investment, Salceda added, “Our corporate sector has accumulated gross savings of about P56 trillion since 2000, which is equivalent to 66.96 per cent of total income during the same period.”
Salceda also estimated the wealth held by Filipinos abroad at about P500 billion.
“Taking advantage of this pool of national wealth requires an economic vision and direction that is resolute, credible and, above all, investable.
existential threat
Like abaca in the past and shipbuilding today, artificial intelligence could disrupt our country’s thriving service sector, Salceda said.
“Therefore, our strategy must consist of three dimensions: harnessing the power of this amazing technological advance, preparing for its disruptive impact, and creating new service areas that are strong in artificial intelligence,” he said.
Promising subsector
Salceda identified three major promising service subsectors that could be “tolerant to artificial intelligence.”
“First of all, our tourism sector is still a rising sector. Tourism is a ‘face-to-face’ industry, so it is resistant to artificial intelligence. Among the six ASEAN countries, it still has the lowest number of tourist arrivals in 2019 and even before the pandemic. We can certainly do better,” he said.
“Second, although our medical sector lacks overall quality, we have some of the best hospitals in the region. We also have a reputation for having top-notch nurses. The Philippines certainly has a future in medical tourism, but we must be ready to make the necessary changes, such as expediting visa issuance for people seeking treatment and their families, and allowing foreign doctors freedom to operate in the country,” he added.
Third, although the education sector again suffers from general deficiencies, it has some of the best universities in the region, he said.
“The University of the Philippines usually ranks among the top 10 best universities in the region, but the top private universities in the Philippines are recognized as among the best in certain academic fields, including English,” he said.
“We have already become an educational destination for countries such as Japan, South Korea, China and India, and even countries such as Nepal and Pakistan. It is right for the President to stress the need to strengthen our dominance in English education. We have a future in this service sector,” he added.
