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Tag: My Cup Of Liberty

Rule of law and property rights, Hong Kong vs China

“... the rules must apply to those who lay them down and those who apply -- that is, to the government as well as the governed -- and that nobody has the power to grant exceptions.” -- Friedrich Hayek, Chapter 10, The Constitution of Liberty (1960)

Why is Philippines’ GDP growth decelerating?

The Philippines’ GDP growth over the past 18 years has a beautiful and not-so beautiful story. Accelerating from 2001 to 2015, then decelerating lately: 6.9% in 2016, 6.7% in 2017, 6.2% in 2018, 5.6% in 2019’s 1st quarter (Q1), then 5.5% in Q2.

How government restricts energy development

In the first week of August this year, I saw seven energy-related stories in BusinessWorld Economy section alone.

We need further FDI liberalization

Foreign direct investment (FDI) is important because the benefits to the destination economy are not limited to capital infusion but also technology transfer, management systems, sources of more production inputs, and extra access to foreign markets. Thus, Japanese FDIs coming to the Philippines not only bring in Japanese capital and technology, but also additional access to Japan and other export markets.

Infrastructure, mobility, and liberty

WASHINGTON, DC -- Among the notable views and experiences for people coming from less developed countries like the Philippines who go to rich countries like the USA are their long, wide, extensive, good roads. Even their rural village or barangay level roads are smooth.

No climate crisis

WASHINGTON, DC -- The various presentations at the Heartland Institute’s 13th International Conference on Climate Change (ICCC-13) on July 25 in this city reiterated what many scientific papers from the fields of meteorology, geology, climatology, physics, chemistry, biology, mathematics, etc. have found -- there is no climate crisis or climate emergency.

SONA 2019: what was said and not said

SEOUL-INCHEON AIRPORT -- An impressive new terminal greeted me here and it will definitely make many Filipinos wish that we have a similar airport soon. This is huge, spacious, and modern, with Wi-Fi that is fast and free. I am here waiting for my connecting flight to the US.

SONA and ICCC-13

Climate change is natural, nature-made and not man-made. It is cyclical -- the warming-cooling-warming-cooling over the past 4.6 billion years of the Earth -- and there is no such thing as “unprecedented” global warming.

Logistics, infrastructure and the consumers

Last Monday, upon the invitation of the Department of Trade and Industry (DTI), I attended the 2nd Logistics Services Conference and Exhibition at the Philippine International Convention Center. I was invited as media and I attended the press conference led by Department of Trade and Industry (DTI) Secretary Ramon Lopez, flanked by leaders of various private industry associations and government officials from the Philippine Economic Zone Authority, the Technical Education and Skills Development Authority (TESDA), the Export development Council the International Finance Corp. ), and the DTI.

‘Solar Para sa Politika’

Among the promises of the Solar Para sa Bayan Corp. (SPBC) franchise bill now awaiting President Rodrigo Duterte’s signature are 24/7 electricity in far away villages, and cheaper electricity because the sun’s rays are free.

Private airports and government airport authorities

As argued in previous columns, I advocate integrated Public–Private Partnership (PPP) -- construction then Operations and Maintenance (O&M) all done and financed by one private entity -- and not hybrid PPP -- construction via foreign loan or national budget, O&M by local private entity. I like the development in some provincial airports that become bigger, more modern international airports, privately owned and managed, and helping attract more foreign tourism, investments and commerce.

Inflation and TNVS costs

The Philippine Statistics Authority (PSA) has reported that the country’s lowest inflation rate this year and last year, or over the span of 18 months, was 2.7% in June. This is indeed good news and can be traced to two major factors.

Solar para sa politika, Part 2

Two weeks ago, this column argued for the President’s veto of HB 8179 or the Solar Para sa Bayan Corp. (SPSBC) franchise bill. I quoted the objection speech of Senator Sherwin Gatchalian, Chairman of the Committee on Energy, on why the bicameral report should not have been ratified.

Inflation in transportation sector

I regularly write on the monthly inflation rates of East Asian economies, and since 2018 until May 2019, the Philippines has been the “inflation valedictorian” of the region because our inflation rate is nearly two to five times those of our neighbors.

Earthquakes and steel

There is understandable concern about the resilience of our structures, public and private, in withstanding earthquakes. But there is also alarmism being spread about the “Big One” happening soon in the Philippines.

Reason over populism in infrastructure development

Populism, or the appeal to pacify the masses and demonize the corporations and “elites,” seems to be getting louder under the Duterte administration than under its predecessors. I will briefly discuss three sectors -- water supply, power development, and mining in this light.

Rising welfarism, rising taxes

Among the factors given why President Duterte’s Senatorial bets won and shut out the opposition in the May 2019 Senatorial elections were: a. high popularity of the President; b. high visibility of his build-build-build programs; c. reduction in inflation in 2019; and, d. failure of the opposition to convince voters that they are the “right group to lead the charge.”

MORE investment liberalization needed

Four reports in BusinessWorld last week seem to show a confusing investment environment of the Philippines:

Solar para sa politika

Among the records of the outgoing Congress is the legislation of a cronyist bill, the Solar Para sa Bayan Corp. (SPSBC) franchise. It is so unpopular that perhaps all other power developers and generation companies (gencos), both conventional and renewable energy (RE), perhaps all private distribution utilities (DUs) and electric cooperatives (ECs) in the country have opposed it.

MORE passenger safety and the LTFRB

Passengers and commuters want convenient, safe, and faster mobility to reach their destinations. There is great inconvenience for people who take multiple rides (tricycle, jeep or bus, MRT/LRT, jeep again to destination, reverse the process going back home). Taking a taxi is good but there are many complaints like choosy drivers, robbery, or sex molestation inside the cab, etc.

MORE employment and labor productivity

The Philippine Statistics Authority (PSA) released the Labor Force Survey (LFS) April 2019 last week and the result was generally good compared to April 2018: both unemployment and underemployment rates in 2019 have significantly declined, and labor force participation rate (LFPR) has increased. Thus, the labor force Q1 data seem to contradict the GDP Q1 data where growth has decelerated further.

Smart energy: Use more conventional sources

Some good news in the world energy sector here. One, world oil prices keep falling, WTI is now only $51+ per barrel vs $62 a month ago and $75 in early October 2018. Two, the US cemented its role as the world’s largest oil producer, its output now 12.4 million barrels per day (mbpd) vs. 8.8 mbpd at the end of the Obama administration. Three, the oil-price decline is despite joint OPEC + Russia oil production cut to force higher prices. China is perhaps the world’s biggest oil consumer but it remains a mid-tier oil producer.

Inflation target below 2% is possible

The May 2019 inflation is 3.2%, so this makes the year to date (Ytd) or January-May 2019 inflation rate 3.5% -- which all makes the Philippines the inflation valedictorian of East Asia, this year and last year.

Smart cities with little congestion and regulations

Metro Manila is composed of 17 cities and has a population of 13.1 million in 2016, the 18th largest city in the world. This 13 million would swell to around 15 million at daytime when people from neighboring provinces come to the big city to study, work, do business and so on. This is big, but not so big compared to other cities around the world like Tokyo, Delhi and Shanghai. Other Asian cities will soon have 10+ million people like Bangkok and Ho Chi Minh (see table).

US-China relations at Jeju Forum

Jeju, S. Korea -- The two largest economies in the world, the US and China, have GDP sizes in 2018 of $20.5 T and $13.4 T, respectively. Third to fifth largest are Japan with $5 T, Germany with $4 T, and UK with $2.8 T.

The Public Service Act and provincial tourism

One of the oldest laws in the Philippines yet having a huge and restrictive impact on the modern economy is Commonwealth Act 146 or the Public Service Act (PSA), which was approved on November 7, 1936, or nearly 83 years ago.

The global taxpayers conference

Many economists along with other social scientists and social philosophers, enjoy playing God, by which I mean laying out in detail their own private versions of the “good society” without being required to suggest ways and means of implementing their precepts or even defend these precepts with democratic political processes. -- James Buchanan

How governments expand

SYDNEY -- This will be one of the topics at the 7th Australian Libertarian Society (ALS) Friedman Liberty Conference + World Taxpayers Association (WTA) Conference from May 23-26 in this city. The event is mainly sponsored by the Australia Taxpayers Alliance and co-sponsored by other free market institutes like the Property Rights Alliance (PRA, USA).

Energy and elections: The Philippines and Australia

Sydney – The Philippines held its mid-terms elections last May 13, and “man-made” climate change, “more renewables” were marginal if not non-issues altogether for many of the national and local candidates. The energy issue was whether there would be any blackout because of the series of yellow and red alerts (insufficient power supply and reserves) many weeks before Election Day.

Jeju Forum and smart cities

ON May 29-31, the big “Jeju Forum for Peace and Prosperity” conference will be held at the International Convention Center Jeju, South Korea. It is an annual international and geographical platform to discuss diplomatic, economic, political and cultural subjects that include the North-South Korea relations, Korea-China-Japan-US relations and many more.

Innovation, competitiveness and development in Asia

Kuala Lumpur -- I just attended the “Asian think tanks dialogue on Innovation, Competitiveness and Development” in Kuala Lumpur sponsored by the Geneva Network (UK). The event, last Wednesday, was attended by mostly free market-oriented and independent think tank leaders with participants from China, India, Indonesia, Malaysia, Myanmar, Philippines (me), Singapore, S. Korea, Thailand and Vietnam.

Senatorial elections and economic legislation

Kuala Lumpur -- During the May 2018 Malaysian elections between former PM Najib and returning PM Mahathir, the latter was an underdog, he promised that if he wins, he would abolish the gross sales tax (GST) of 6%. He won, he did what he promised, and GST went down from 6% in May to zero in June. Result was drastic, across the board price declines and inflation rate went down from 1.8% in May to only 0.8% in June 2018. The average inflation January-May 2018 of 1.7% became 0.6% in June-October 2018.

Low growth, high taxes as election issue

In election years, the Philippines’ GDP growth rate is always above 6.5% – except in 2001 (terrorist attack in the US, Gloria Arroyo anemic growth) and 2019. Philippines’ growth trajectory is on a downhill: 6.9% in 2016, 6.7% in 2017, 6.2% in 2018, and only 5.6% in the first quarter of 2019. Growth deceleration since Dutertenomics was invented is further confirmed.

Power shortage as election issue

Until last week May 3, another yellow alert has been issued by the National Grid Corp. of the Philippines (NGCP) because of insufficient reserves due to the following: (a) forced outage due to earthquake of GN Power Mariveles (316 MW), (b) unplanned/forced outage of SEM Calaca U2 and Team’s Pagbilao U1 (582 MW), and (c) derated/reduced capacity of five power plants (736 MW). Total 1,634 MW unavailable, that’s big.

MORE price declines, less Dutertenomics

As the mid-terms election approaches, we see and hear more “good economic news” coming from the administration. The goal is to dupe the voters into voting the administration senatorial and congressional candidates. Numbers below show that the administration is spewing half-truths.

MORE smart cities… with sufficient water

Metro Manila is expanding fast with 13+ million residents, plus an estimated 2+ million from surrounding provinces going to the big city for work,...

MORE transparency in China deals

Three China-related business stories in BusinessWorld last week caught my attention, short quotes from them are shown:

IPR and MORE investments

A report in BusinessWorld reiterated the value of IPR protection: “PHL remains out of US IPR watch list for 6th year’ (April 27, 2019)

Good news, MORE power plants coming

“Whatever that can go wrong will go wrong.” -- Murphy’s law.

MORE tourism via PSA liberalization

The Philippines’ tourism sector is among the more dynamic ones in the economy. The Department of Tourism (DoT) targeted 89.2 million domestic tourists in 2022 but this was already surpassed in 2017 with 97 million.

Earthquakes and MORE sturdy buildings

Earthquakes and volcanic eruptions are 100% part of the Philippines’ “geological DNA.” This is because we are in the “Pacific Ring of Fire” and our entire archipelago seems to have protruded from under the sea. Thus, if there were no “violent” volcanic activities, there would be no Philippines.

MORE Senators for rule of law

Rule of law means the law applies equally to unequal people, no one is exempted and no one can grant an exemption. Granting exemptions, say, in the law against stealing or murder automatically leads to the rule of men where the powerful and the mob are exempted from penalties for violating certain rules.

MORE IPR protection

Unlike physical property which is tangible, intellectual property rights (IPR) are intangible, like copyrights of songs, patents of newly invented medicine molecules, trademarks of known brands, and trade secrets. Thus, public appreciation of IPR protection is not as high as physical property protection.

MORE power supply needed: Attention ERC

After the water shortage in many areas in Metro Manila last March, next is power shortage and brownouts in many areas of Luzon including Metro Manila this month.

MORE de-bureaucratizing laws, please

From January to March 11 this year, Congress has created and passed 77 new laws, 28 of national application (table below) and 49 being local or franchise laws. The dates when they were approved by the President this year are also here.