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Digital infrastructure seen crucial in boosting competitiveness

THE Philippines must improve its digital infrastructure to boost competitiveness while also increasing its resilience to crises like the pandemic, a National Economic and Development Authority (NEDA) official said.

An online panel assembled by the Asian Institute of Management Thursday was tackling the ranking of 45th out of 63 economies assigned to the Philippines by the Institute for Management Development (IMD) 2020 World Competitiveness Report, and how competitiveness can be addressed during the coronavirus disease 2019 (COVID-19) pandemic.

The ranking was one notch higher from the previous year, but was 13th place out of 14 Asia-Pacific economies.

The Philippines in the IMD report ranked 40th in both the use of digital tools and digital transformation in companies and 52nd in digital skills.

NEDA OIC-Director of Trade, Services, and Industry Bien Ganapin said that the Philippines must further develop information communications technology (ICT), saying that the government must scale up its use of digital transactions and signatures.

“We need to further develop ICT and financial technology,” he said.

“In terms of digital adoption, the country fares poorly compared to our regional, middle-income peers… aside from the need for additional investment in critical ICT infrastructure, policies and measures to protect consumers engaging in online transactions — we need to also establish that. For MSMEs and vulnerable economic sectors, we need to encourage them to take advantage of new and emerging technologies to allow them to recover from their losses.”

He also said that the country must reduce barriers to entrepreneurship, improve the regulatory environment for business, and encourage pro-competitive collaboration among firms.

UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said the country is shifting to a contactless economy.

“We’re now involving ourselves in social distancing… a lot of services will just go online and you’ll be seeing much of that… with that type of emerging economic theme of being contactless or low touch types of businesses, I think we really need to be innovative.”

Trade Undersecretary Rafaelita M. Aldaba said there should be more emphasis on innovation, and a shift in manufacturing to health products critical to responding to the crisis.

“There was a need for us to shift towards digital transformation, but I think with the crisis, now it has become more urgent,” she said.

IMD World Competitiveness Center Senior Economist José Caballero said in an e-mail that the Philippines’ lack of improvement in the four factors studied in the report was caused by the negative impact of a downturn in the resilience of the economy, mixed performance in business efficiency due to improved productivity but a decline in attitudes and values, and a stagnation in infrastructure, among others.

“The Philippines’ slight improvement is mainly due to an increase in international trade and a steady performance of its labor market. The improvement also reflects an increase in overall productivity and efficiency,” he said.

American Chamber of Commerce of the Philippines Senior Advisor John Forbes said it is difficult for the Philippines to move up in ranking among the ASEAN 5, falling behind Indonesia, Malaysia, Singapore, and Thailand.

“The Philippines has been stuck roughly in the same range for more than a decade. If it can really cut red tape, return to 6%+ GDP growth, and keep infrastructure spending above 5% we expect it can catch up with Indonesia and be among the top half of the select group of (63) economies ranked.” — Jenina P. Ibañez

IATF declares hunger reduction a priority

THE government task force dealing with the coronavirus disease 2019 (COVID-19) outbreak will seek to ensure the unhampered movement of goods while providing farmers with equipment to help ensure food security.

In a statement Thursday, Cabinet Secretary Karlo Alexei B. Nograles said the Inter-Agency Task Force for the Management of Emerging Infectious Diseases (IATF-EID) will prioritize reducing hunger and safeguarding the food supply during the crisis.

He said the IATF-EID will focus on the following: “(1) ensure unhampered movement of agriculture and food goods and services through efficient transport and logistics systems; (2) intensify provision of support services and farm machinery and equipment; (3) strengthen online marketing of agricultural produce; (4) ensure safety of food and agricultural products supplied in the market; and (5) intensify research and development for agriculture.”

The IATF-EID said the launch of the Supply Chain Analytics (SCAN) IATF Reporter Mobile App will also help ease supply chain issues. Mr. Nograles said: “The information contained in the SCAN Dashboard will be vital to the government and the private sector in addressing the issues that hamper the flow of goods and inputs for production.”

The system was first proposed by the National Economic and Development Authority and was launched last month.

Due to the pandemic, hunger rates in the Philippines have worsened. He cited a study by the Social Weather Stations in May which found that 16.7% of Filipinos experienced involuntary hunger that month, roughly double the 8.8% in December 2019.

As head of the Task Force on Zero Hunger, Mr. Nograles said there is “a lot of work to do” in food security and food accessibility. — Gillian M. Cortez

Hog cull from ASF approaching 300,000

NEARLY 300,000 pigs have been culled as a precaution against African Swine Fever (ASF), according to the Bureau of Animal Industry (BAI).

In a virtual briefing Thursday, BAI Director Ronnie D. Domingo said that as of June 18, 298,844 pigs across 25 provinces and eight regions were culled since the declaration of the outbreak last year.

Mr. Domingo said that most of the confirmed ASF cases are in Luzon, home to 22 of the 25 affected provinces, which include Metro Manila.

Pigs were culled in Bulacan, Pampanga, Nueva Ecija, Pangasinan, Rizal, Camarines Sur, Bataan, Quezon Province, Cavite, Metro Manila, Tarlac, Batangas, Isabela, Aurora, Ifugao, Benguet, La Union, Zambales, Nueva Vizcaya, Cagayan, Laguna, and Quirino.

ASF cases were also reported in Davao Occidental, Davao City, and Davao del Sur.

Despite the rising number of culled pigs, Mr. Domingo downplayed any concern, adding that the cull is equivalent to around 3% of the total hog population.

“Since the declaration of the enhanced community quarantine in March, ASF cases dropped to 20 cases for every one million pigs,” Mr. Domingo said.

The Department of Agriculture has said it will allocate P400 million to support hog raisers affected by the ASF outbreak.

The P400 million will include the supply of piglets to kick-start the restocking of the hog population. — Revin Mikhael D. Ochave

Serena Williams ‘cannot wait’ to play in this year’s US Open

TORONTO — Fears that strict health protocols due to the COVID-19 pandemic could deter the game’s biggest names from competing at this year’s US Open were somewhat allayed on Wednesday when Serena Williams confirmed she will play the New York event.

Williams, in a video message played during a United States Tennis Association (USTA) news conference to announce that its marquee tournament will be played from Aug. 31–Sept. 13 without fans, said she misses the excitement of competition.

“Ultimately, I really cannot wait to return to New York and play the US Open 2020,” the seven-time champion said.

“I feel like the USTA is going to do a really good job of ensuring everything is amazing and everything is perfect and everyone is safe.”

A number of top players, including world number ones Novak Djokovic of Serbia and Australian Ash Barty along with reigning US Open men’s champion Rafa Nadal, are among those who have expressed concerns about attending the US Open.

One sticking point is the number of support staff they can bring on site, which the USTA said it is still trying to sort out.

The decision will impact the upper echelon of players who typically travel to events with a coach, hitting partner, physiotherapist and fitness guru.

“We understand the needs of athletes,” US Open tournament director Stacey Allaster said during a video conference from the center court at Arthur Ashe Stadium. “We just need to make sure that we navigate physical distancing and ensure that we keep everyone spread out and also everyone gets the proper training and preparation that they need.”

Ms. Allaster also said players who do not want to stay at one of the two designated hotels can rent homes in the New York area but cannot stay in Manhattan.

‘UNDERSTANDING THE RISK’
The Billie Jean King National Tennis Center, home to the US Open, will also host the Western & Southern Open, which is normally held in Ohio, from Aug. 22–28 as part of efforts to stem the spread of the virus.

Testing will be conducted before travelling to the United States and 1–2 times per week at both events along with daily temperature checks.

During the US Open, which this year will not include a mixed doubles tournament, players and guests must wear masks when onsite unless practising or competing.

There will be linespersons for matches inside both Arthur Ashe Stadium and Louis Armstrong Stadium but none on the other courts, where a chair umpire will work with the electronic line-calling system HawkEye Live.

Should an athlete test positive, they will be isolated and cared for by a USTA medical professional who will determine whether treatment can be done at the hotel or if the individual needs to be hospitalized.

“We all go into this understanding the risk and our responsibility,” Ms. Allaster said. “As in every year, the health and wellbeing of our athletes, their safety is paramount to our medical team and it will be unwavering during this event.” — Reuters

PHL takes on Indonesia at FIBA Esports Open 2020

By Michael Angelo S. Murillo, Senior Reporter

TEAM PHILIPPINES battles its counterpart from Indonesia when the inaugural FIBA Esports Open rolls off today.

A three-day event till June 21, the FIBA Esports Open 2020 is a pilot project by world basketball-governing body FIBA and its member federations in collaboration with NBA 2K.

The esports competition is angled to add further dimension to FIBA as an organization while also affording the basketball community some action after activities were halted by the coronavirus disease 2019 (COVID-19) pandemic.

It will feature teams from Argentina, Australia, Austria, Brazil, Cyprus, Indonesia, Italy, Latvia, Lebanon, Lithuania, New Zealand, the Philippines, Russia, Saudi Arabia, Spain, Switzerland and Ukraine.

For the competition each team will consist of seven players, five on the court and two reserves. Games will be played remotely on NBA 2K using the Pro-AM mode and allowing full customization of player avatars, uniforms and arena designs.

Carrying the banner for the Philippines in the Esports Open are seasoned e-gamers Aljon “Shintarou” Gruzin (point guard), Rial “Rial” Polog Jr. (shooting guard), Custer “Aguila” Galas (small forward), Rocky “Rak” Brana (center/power forward), Philippe “Izzo” Alcaraz Herrero IV (center), Clark “Clark” Banzon (power forward) and Al “Alt” Timajo (center/power forward).

Team coach is Nielie “Nite” Alparas, with Richard Brojan serving as team manager.

“I believe Team Pilipinas is a ‘dream team,’ and I’m just humbled that I’m part of this because I have been playing this game almost half of my life,” said team captain Herrero.

“With exceptional mechanics, good teamwork, and amazing teammates under my leadership, we can make it to the top. I’m just happy and excited to represent our country and make the Filipinos proud,” he added.

Team Philippines packs some solid credentials with Mr. Gruzin an eight-time NBA 2K Pro-AM champion; Mr. Polog the first Filipino player to be drafted in the NBA 2K league; Mr. Banzon an NBA 2K20 Global Championship representative; and Mr. Galas the NBA 2K Asia Champion.

“Our Team Pilipinas is on the cusp of something great here,” said Butch Antonio, Director of Operations — Samahang Basketbol ng Pilipinas, of the team’s bid.

“The great thing about competing in the virtual realm of esports is that there’s no size mismatch, no height difference, there’s only the dedication and drive to win — something that our sportsmen have always had in spades,” he added.

During the exhibition games, Team Pilipinas will be playing five games head-to-head with Indonesia, beginning today at 6:30 p.m.

Team Pilipinas matches will be shown over the SBP Facebook page.

The entire FIBA Esports Open 2020 series will be produced from the brand-new FIBA Esports Studio located in Riga, Latvia.

NTSB: Pilot in Bryant crash might have been disoriented

LOS ANGELES — The pilot of the helicopter that crashed into a hillside with Kobe Bryant aboard may have been disoriented by thick fog shortly prior to impact, according to a report by the National Transportation Safety Board (NTSB).

The NTSB report said Ara Zobayan might have “misperceived” the angles at which he was travelling when he reported he was climbing while the helicopter was actually descending. The crash on Jan. 26 in Calabasas, California, killed Zobayan, Bryant and seven others.

The report states that when Zobayan told air traffic controllers he was climbing to 4,000 feet to get above clouds, the helicopter was instead plunging in direction of the hillside.

“Calculated apparent angles at this time show that the pilot could have misperceived both pitch and roll angles,” the report stated. “During the final descent the pilot, responding to (air traffic control), stated that they were climbing to four thousand.”

The 1,700-page report didn’t list a conclusion for the cause of the crash. The NTSB said a final report will be released later.

A recent autopsy report on Zobayan said the helicopter was travelling 184 mph when it crashed into the hillside.

According to the NTSB report, the 50-year-old Zobayan sent out a group text about 45 minutes before the flight to say weather was looking “OK.”

The helicopter took off from John Wayne Airport in Orange County at 9:06 a.m. The eight passengers aboard had all flown on the helicopter to the same destination — a basketball tournament at the 41-year-old Bryant’s sports facility in Thousand Oaks — the previous day.

Bryant’s 13-year-old daughter, Gianna, also died in the crash, as did two of her youth basketball teammates: 14-year-old Alyssa Altobelli and 13-year-old Payton Chester.

Others who perished were Altobelli’s parents — Orange Coast College baseball coach John Altobelli (age 56) and his wife Keri Altobelli (46) — and Payton Chester’s mother, Sarah Chester (45). Assistant basketball coach Christina Mauser (38) also died. — Reuters

SBP pays tribute to hoops ‘titan’ Danding Cojuangco

RECOGNIZING his invaluable contribution to the growth of Philippine basketball in the last 40 years, the Samahang Basketbol ng Pilipinas (SBP) joined the local hoops community in paying tribute to Eduardo “Danding” Cojuangco Jr., who passed away on Wednesday at the age of 85.

“Philippine basketball lost a titan,” said the local basketball federation in a statement just as it underscored how Mr. Cojuangco was a “passionate sportsman” apart from being a brilliant businessman, who turned San Miguel Corporation into the biggest food and beverage conglomerate in the Philippines.

Mr. Cojuangco was a strong advocate of sports, particularly basketball.

In the 1980s, he helped form the Northern Consolidated Cement (NCC) basketball team which had a lot of success in tournaments it competed in, bringing sporting pride to the country.

A mix of amateur and naturalized players and coached by the late Ron Jacobs, the NCC squad, playing as the national team, won the Southeast Asian Games in 1981 and 1985, the 1982 ABC Juniors Championship, the 1984 Asian Interclub Championship and 1985 ABC championship. It also won the William Jones Cup in 1981 and 1985.

Among its notable players were Hector Calma, Franz Pumaren, Samboy Lim, Allan Caidic, Alfie Almario, Chip Engelland, Jeff Moore and Dennis Still.

NCC chalked up a Philippine Basketball Association title (1985 PBA Reinforced Conference) as well when it participated as a guest team in Asia’s first play-for-pay league from 1884 to 1985.

The team disbanded in 1986.

Under the leadership of Mr. Cojuangco, the San Miguel group also had a lot of success in the PBA, highlighted by a league grand slam in 1989 by the Beermen and the emergence of crowd favorite Ginebra, led by league legend Robert Jaworski, in the late ‘80s.

The group had further success when it added the Purefoods franchise in its fold later on.

All three teams are still active and a force to contend with in the PBA.

In the last decade, Mr. Cojuangco was once again an active supporter of basketball, this time in the University Athletic Association of the Philippines, backing his alma mater, De La Salle University.

With his support, the Taft-based Green Archers won the UAAP title in 2013 and 2016.

Mr. Cojuangco’s involvement in basketball “led to the enrichment of the lives of so many players, coaches, and staff who have nothing but great words to say about ‘ECJ’,” noted the SBP.

“We, at the Samahang Basketbol ng Pilipinas, mourn with the entire nation and extend our deepest condolences to the Cojuangco family.”

Mr. Cojuangco died after battling a lingering illness. He is survived by his wife Soledad “Gretchen” Oppen-Cojuangco with whom he had four children, and domestic partner Aileen Damiles with whom he had two children. — Michael Angelo S. Murillo

Registration for World Vision’s virtual run for children extended

THOSE who want to take part in the first-ever World Vision Virtual Run for Children still have time to sign up as registration for it has been extended till the end of June.

The initiative is aimed at promoting fitness and health while the country is still under community quarantine because of the coronavirus disease 2019 (COVID-19) pandemic while at the same time raising funds for the benefit of the organization’s most vulnerable children and communities.

As the entire country deals with COVID-19, World Vision recognizes that children are among those impacted greatly by the pandemic, with their access to basic needs like food, education and hygiene compromised.

Those interested to participate in the virtual run just have to sign up by selecting the advocacy they wish to support, whether Education or Health & Nutrition, and their preferred mileage, either 21K, 50K, 100K, or 200K.

Then they run anytime and anywhere between June 15 and July 31.

Once they have reached the goal, they can get a limited-edition World Vision Virtual Run for Children Finisher Shirt and a Finisher Medal.

The participants can walk or run whether indoors or outdoors and use a running or steps app to monitor the distance while making sure that they follow the community quarantine regulations in their area.

The fees range from P1,050 to P1,650 and it is inclusive of a shirt, medal, and an e-certificate. A portion of the proceeds will contribute to World Vision’s projects for Education and Health & Nutrition.

While the virtual run already started on June 15, organizers are still encouraging people to sign up for the run for a cause till June 30, highlighting that with more participants more people can benefit.

“Through God’s grace, we stay committed to serving the most vulnerable children. We pray that the World Vision virtual run will inspire many people to take an active role in helping others even in these complex times. Thanks to our ambassadors, and may all of us have a wonderful time running for children,” said Rommel Fuerte, World Vision National Director.

World Vision’s 1st Virtual Run for Children is done in cooperation with Takbo.ph.

To register for the World Vision Virtual Run for Children, visit www.takbo.ph/vr/worldvisionrun2020. For more updates on the event, like and follow World Vision Run on Facebook, www.facebook.com/worldvisionrun. — Michael Angelo S. Murillo

Le Mans 24 Hours Virtual: A compelling esport experience for Michelin

MICHELIN TIRES took front and center in the recent Le Mans 24 Hours Virtual, with all winning teams running on the brand’s “virtual” tires.

The first-ever Le Mans 24 Hours Virtual saw Rebellion Williams Esport claim first place with its N°1 car shared by Deletraz / Marciello / Wisniewski / Brzezinski. Pole-sitter Dillmann / Guerrieri / Simoncic / Pedersen (N°4 ByKolles Burst Esport) was second past the checkered flag, ahead of the N°13 Rebellion Williams Esport foursome (Canapino / Aitken / Arana / Romanidis.

The GTE class, meanwhile, was won by Porsche Esports Team which emerged as the category’s dominant squad in qualifying.

The top prize was secured by the N°93 Porsche 911 RSR of Tandy / Güven / Rogers / Ostgaard thanks to a surefooted performance. Interestingly, British driver Nick Tandy can now claim to have won Le Mans’ GTE class with Porsche and Michelin in both the real world and “virtually.”

Second in class went to the N°95 Aston Martin (Thiim / Westbrook / Sorensen / Biancolilla), while R8G Esports Team’s N°80 Corvette (Juncadella /Beche / Jayovski / Kappet) took third.

With real-world motorsport halted by the coronavirus disease 2019 (COVID-19) pandemic, the inaugural Le Mans 24 Hours Virtual, done over rFactor2 software, provided endurance racing fans with a welcome chance to enjoy their favorite discipline once more while giving video game fans an opportunity to discover motor racing from a fresh perspective that introduced them to the important role that tires play in motorsport.

Buoyed by a field of 50 cars and 200 top-flight racing drivers and sim racers, the virtual race lived up every bit to its promise. Drivers from different forms of racing and top names from the world of endurance racing teamed up with a lineup of sim racing stars to showcase their professionalism not only during their respective pre-race preparations but also in the course of the twice-around-the-clock race itself. The result was a gripping fight between the successive leaders who all chose similar race strategies and the gaps at the end were extremely close.

As expected, teams with the strongest reputations took turns in front and took the two ‘virtual’ red-flag interruptions that bunched up the field in their stride.

“The inaugural Le Mans 24 Hours Virtual was a resounding success,” said Michelin Motorsport Director Matthieu Bonardel.

The drivers were swift to credit Michelin’s tires after qualifying and their praise continued during the race as they paid tribute to the realism of the feedback replicated via the steering wheel, and notably the difference between the feeling of the different compound options.

Given that the Le Mans 24 Hours Virtual allowed motor racing enthusiasts to enjoy the action in the virtual company of video game fans who often have little interest in real motorsport, Michelin saw its involvement in the race as a chance to reach out to a wider audience which was able to discover the importance of the role played by tires not only in real-life racing but also, by extrapolation, on their road cars.

Michelin’s involvement in the inaugural Le Mans 24 Hours Virtual asserts its commitment to esports and, in September, it will be looking to follow up by extending its current unbeaten record in the real race to 23 victories in a row since 1998.

Working schedules

In a bid to reinstate a semblance of regularity to organized tennis, the men and women’s tours yesterday released its provisional calendars marking the resumption of sanctioned competition in August. On one hand, it’s still a month and a half away, giving the Association of Tennis Professionals and the Women’s Tennis Association leeway to establish safety protocols for event participants while in the midst of the pandemic. On the other, it’s just a month and a half away, with not quite enough time in between to pin down the moving target that is the novel coronavirus. There are risks involved, especially in light of the sport’s global nature; depth of field is directly tied to mobility, which is currently restricted for obvious reasons.

That said, the fact that the internal planning of the two tours has progressed enough for them to release working schedules is good news. There remains much to be done, but work has been ample to the point of ensuring that players returning to the court is a matter of when, not if. And, as with the restarts in other sports, that in tennis involves significant sacrifice, commitment, and focus off a thorough assessment of pros and cons. There’s no question that all and sundry want to get back on their feet. There’s also no doubt that reasonable second-guessing will come before any decision either way.

For the United States Tennis Association, the tours’ timetable dovetails with its own on the staging of the US Open. The pinpointed late-August start to the Grand Slam event affords those casting moist eyes on the championship to get back to shape. Nonetheless, the means will be harder; quarantine protocols will constrict movement to and from practice courts, and then to tournament venues, where bubble systems will be set up to minimize the possibility of infection. Already, protests from hopefuls in other countries have blasted the decision not to cancel the major stop as exceedingly unfair.

In truth, the setting of ideals as minimum standards has become untenable. With chaos introduced by the pandemic at every turn, all the USTA has been able to do is cope by first regaining its footing, and then striving to strike a rational balance en route to the new normal. And, in this regard, the key isn’t avoiding mistakes; there are too many variables for even the most forward-thinking quarters to project every eventuality. Instead, the goal is to keep learning from them. Sense and sensibility dictate the need to stunt the negatives and maximize the positives. Easier said than done? Certainly. Then again, the first step is always the hardest to take. It is also the most important; if nothing else, it underscores a burning desire to try.

 

Anthony L. Cuaycong has been writing Courtside since BusinessWorld introduced a Sports section in 1994. He is a consultant on strategic planning, operations and Human Resources management, corporate communications, and business development.

Dealing with democracy deficit in the time of COVID-19

Using four standards of competitiveness as basis: economic performance, government efficiency, business efficiency and infrastructure; and relying on 2019 hard data and perceptions from a 2020 executive opinion survey, the 2020 International Institute of Management1 (IMD) World Competitiveness ranked the Philippines 45th out of 63 economies.

The Philippines dropped from 38th to 44th place in the area of economic performance. This measure covers the domestic economy, international trade and investment, employment and prices.

The country also dropped one rung from 41st to 42nd in the area of government efficiency which embraces public finance, tax policy, institutional framework, business legislation and societal framework.

There was also a slight deterioration in ranking from 32nd to 33rd in business efficiency which includes productivity and efficiency, labor market, finance, management practices, attitudes and values.

We kept our standing at 59th place in the area of infrastructure covering basic, technological and scientific infrastructure, health and environment as well as education.

The most competitive economies were: Singapore, Denmark, Switzerland, the Netherlands, and Hong Kong SAR in that order. Some emerging economies in Asia were prominent in this year’s ranking including Malaysia at 27th, Thailand at 29th, Indonesia at 40th, and India at 43rd. Bigger emerging markets came in lower like Mexico at 53rd and Brazil at 56th.

In the case of the Philippines, we moved up one rung from 46th to 45th following a slight shift of various components from last year’s assessment. Respondents to the survey ranked the Philippines high in its skilled workforce, economic dynamism, high educational attainment, cost competitiveness and effective labor relations. We scored less in corporate governance, government competency, policy stability and predictability.

The Yearbook called on the Philippines to intensify its mitigation efforts against the viral pandemic and in restoring normalcy. It reminded us that the healthcare system must be prepared for any possible resurgence of the virus. It also advised in favor of continuous strengthening of the infrastructure program.

In previous columns, we stressed that the Philippines has an excellent economic story. It is a narrative that spans 20 years of uninterrupted growth buttressed by 25 years of policy and structural reforms. Despite this achievement, there are still some governance shortfalls.

The challenge is exacerbated by the fact that like the rest of the world, we are battling a formidable health crisis. In peace, as in war, follow-up and mopping-up operations are keys to total victory.

Our experience with our public health care management “strategies” during this pandemic and our three-month community quarantine have been very instructive. A “democracy deficit is now as much a problem as budget and trade deficits,” wrote Satyajit Das in his book The Age of Stagnation as early as 2016.

There is a “democracy deficit,” when policies intended to increase public welfare actually penalize the vast majority. As a result, there often is public resistance, instead of public ownership, of such policies. Public trust wanes and suffers.

For instance, managing a sizable public debt usually comes with the trade-off with lower growth, inflation and fiscal austerity. There is also risk of default. This was the experience of many emerging markets during the 1980s and during the Asian Financial Crisis of 1997. Many countries sustained lower growth, higher inflation, and timid, self-defeating fiscal policies. In some Latin American countries, debt restructuring drained default domestic savings. These generated pressures created another round of financial crisis. Since many other critical factors such as the structure of specific economies were at work, currency devaluation also failed to establish competitiveness in many countries.

There is a shortfall of democracy when banks charge depositors for placing savings with them. Germans call it a “punishment rate.” Das wrote that in 2007 to 2012, near zero or negative interest rates brought $1.6 trillion to US, UK, and Euro governments in the form of reduced debt service costs and increased central bank profits. After the GFC and following QE operations, the US Fed ran a bigger balance sheet, earned huge interest income from purchases of government bonds and remitted a cumulative dividend of about $500 billion. Non-financial corporations were reported to have gained around $700 billion through lower debt servicing costs. These losses were shouldered by civil society: households, pension funds, insurers and even foreign investors. Households alone lost more than $600 billion.

There is a democracy deficit when banks abuse their fiduciary roles such as when Goldman Sachs encouraged its clients to invest in securities or products they wished to unload at a profit prior to the GFC, resulting in clients stuck with undesirable assets. Data on flow of funds (FoF) can trace “savers and dissavers,” or “winners and losers” in an economy for any given year.

Our most recent 2018 FoF data for the Philippines was driven by such factors as high inflation due to exogenous factors and elevated trade tension between the US and China. While the economy realized gross savings of more than P4 trillion, or 9.5% higher than the previous-year level, because of the Build, Build, Build program, capital accumulation surpassed the increase in national savings. The result was invariably net borrowings of more than P458 billion from the rest of the world, four times larger than the 2017 level. The general government was the highest borrower while financial corporations lent less than in the previous year. This was reflected in the higher current account shortfall as more imports of raw materials and intermediate goods fueled domestic economic activities.

Years from now what would our 2020 FoF data indicate? Who would emerge as the winners and losers owing to COVID-19 management — or lack of it — and public policies to restart the economy? Will a democracy deficit become evident?

There is a democracy deficit when during a crisis, public policies partake of what former Citigroup chief economist Willem Buiter, my professor in international monetary economics at LSE, described as “potpourri of factoids, partial theories, empirical regularities without firm theoretical foundations, hunches, intuitions and half-developed insights.”

In other words, there is a democracy deficit when public policies are not based on careful thinking and strategic planning.

The collateral harm to the general public — in terms of the terror we did not prevent, or infections and deaths we did not mitigate — mutate into actual assault against democracy itself.

 

Diwa C. Guinigundo is the former Deputy Governor for the Monetary and Economics Sector, the Bangko Sentral ng Pilipinas (BSP). He served the BSP for 41 years. In 2001-2003, he was Alternate Executive Director at the International Monetary Fund in Washington, DC. He is the senior pastor of the Fullness of Christ International Ministries in Mandaluyong.

Heroes all

It seems hardly necessary to recall the continuing relevance of the life and writings of Jose P. Rizal, whose 159th birth anniversary the country should be marking today with greater urgency.

But it has always been in order because in the age of social media, Hollywood, and Marvel superheroes, too many Filipinos either have only a limited knowledge of who he was, or worse, are unaware of his role in the making of the Filipino nation — and least of all the lessons they can draw from it.

His novels Noli Me Tangere and El Filibusterismo have been required reading in the country’s schools since the 1950s. But that has not prevented his being subjected to such mindless forms of adoration as the emphasis on his many loves and the telling and retelling of anecdotes about his childhood that even then supposedly prove his greatness.

Born on June 19, 1861, Jose Protacio Rizal Mercado y Alonso Realonda seemed an unlikely hero because of his family background, his talents and his intellectual capacity. A scion of a relatively well-off middle class Calamba, Laguna family, from his hometown he established himself in Manila to study at Ateneo de Manila and the University of Santo Tomas. He learned several languages, and later earned degrees in philosophy and medicine from Spanish, French, and German universities. He later completed the eye specialization program of Heidelberg University in Germany and became the ophthalmologist he wanted to be.

He was neither a Spaniard nor a Spanish mestizo. But while it was not likely to be especially bright, his future seemed fairly secure even in Spanish colonial Philippines, if only he had kept silent, and did not use his writing skills to describe to his countrymen and the rest of the world what was happening in his native land. He did not succumb to what the Greek novelist Nikos Kazantzakis described in his The Last Temptation of Christ as the most powerful lure of all to which even exceptional individuals are subject: that of conformity and becoming like everyone else. He took the road less traveled of social and political engagement rather than living a “normal” life of silent complicity with the powerful who were responsible for the suffering of his countrymen.

Like any man of intelligence and heart, he could not abide the injustice and the misery that he saw around him. A child of the Enlightenment (an ilustrado), and driven by outrage and a sense of justice, he described in his essays and novels how an unjust order founded on hypocrisy, deceit, and brutality was destroying lives daily, and, because of the color of their skin, was condemning an entire people to perpetual want. Although basically a reformist, for telling the truth in his writings he was executed by musketry on Dec. 30, 1896 on charges of sedition and conspiring to overthrow the Spanish colonial regime.

Because whether or not he approved of and was supportive of the Revolution that Andres Bonifacio’s Katipunan launched is at least uncertain, and his designation as national hero the doing of the US colonial regime that replaced that of Spain, the late nationalist historian Renato Constantino and other Bonifacio partisans have raised doubts about whether he was, indeed, an authentic hero. But revolutions are waged not only in the battlefield but also in the mind. To change the world it must be explained, interpreted, and understood, and it was in that enterprise that Rizal excelled. Although he wrote in the language of the colonizer, his essays and novels helped inspire the Bonifacios and the Jacintos and countless others to take up arms against Spanish rule.

The link between knowledge, understanding, and change helps explain why, as the peoples of the world are seeing now, every tyranny has persecuted, terrorized, imprisoned and even murdered truth-tellers and tried to control the flow and quality of information. In today’s world, in which the media have never been as extensive in their reach and power over consciousness, providing the relevant and accurate information every human being is entitled to has become the primary responsibility of journalists and those other sectors committed to the necessary task of describing and understanding the world.

Never has meeting this responsibility been as urgent as today, whether in this country or in many others. The COVID-19 pandemic alone has made the dissemination of information not only crucial to the well-being and health of millions but even a matter of life or death.

The United States, the country with the most number of novel coronavirus infections at nearly two million and with over 100,000 dead, has achieved that sorry distinction through the disinformation that at least partly emanated from its current President.

Donald Trump belittled the threat of the pandemic, and thus helped spread such other falsehoods as that it was no worse than the flu, and that neither social distancing nor face masks are necessary in preventing the transmission of the disease. Despite the efforts of the media, epidemiologists and other experts to provide the information that can save lives, many Americans are going to the beaches without protection, and holding protests demanding the reopening of restaurants, night clubs and other public places.

Information has better served Americans on the perennial issue of racism, which has become the concern of millions because of the brutal police killing of George Floyd, an unarmed black man police said was passing counterfeit bills.

Thanks to the media, human rights, lawyers’ and civic groups as well as individual white and colored people, even corporations and Donald Trump’s own officials and Republican allies, have protested the killing and urged the adoption of reforms to stop police violence against African Americans in the United States despite Trump’s defending and virtually justifying what the police did. The likelihood is that the Floyd killing will be a crucial issue in the reelection of Trump this November as his approval ratings continue to slide and support for his possible rival Joseph Biden surges.

Here in the Philippines, the vast outpouring of protests against the so-called Anti-Terrorism Bill from journalists’ and media advocacy groups, students and academics, lawyers and human rights defenders, other professionals, and farmers and workers has focused attention to the imperative of resisting the passage of the bill as well those other oppressive laws similarly violative of the Constitutional rights to due process, free expression and press freedom.

The protests have made information about them in print, broadcast, and online media available to thousands of citizens who were earlier uninformed about, or indifferent to it, thanks to those men and women who are risking arrest and even putting their lives on the line in the defense of citizen rights and the making of a better Philippines.

On this day, June 19, as well as last Independence Day, these groups and individuals are demonstrating once again that heroism takes many forms, and that, just like Rizal, rather than be silent and complicit with the ongoing assault on fundamental freedoms, they too have chosen to take the less travelled path of political and social engagement that this country urgently needs from its citizens. Front liners in combating tyranny, oppression and injustice, they are heroes all.

 

Luis V. Teodoro is on Facebook and Twitter (@luisteodoro).

www.luisteodoro.com