an empty victory : the mood's still bleak

the philippines finally clinched its third investment grade rating from a major international debt rater, moody's investors service (please click here for the moody's statement on the rating upgrade), completing its climb into the privileged and perfumed circle and eclipsing its wealthier neighbor indonesia, which has yet to seal an investment grade rating from another global debt watcher standard & poor's, a feat the philippines secured in may this year.
(indonesia, by the way, long been counted as the closest rival of the philippines in terms of luring foreign capital (either in the form of debt or investment), won an investment grade rating from fitch and moody's a year or so ahead of the philippines. but indonesia has yet to receive an investment grade rating from s&p. because indonesia only has two investment grade ratings, some investors like the conservative japanese still can't invest in the south east asian country's yen bonds if they are not guaranteed say by a japanese agency like the japan bank for international cooperation or jbic. now getting a jbic guarantee entails additional cost for the issuer. the philippines with three investment grade ratings can now issue yen bonds without a jbic guarantee.)
what the investment grade rating means is that portfolio managers, who are not allowed to invest in risky assets (those rated junk or below investment grade), can now buy philippine government bonds. the wider market for government bonds means that demand for these debts would increase, thus raising their prices and conversely, lowering interest rates and making it cheaper for the country to borrow; or even to retire these debts through debt buybacks and swaps.
this is indeed good news for a country that still allocates about a third of its annual budget to pay for the interest alone on its foreign debts. the lower borrowing costs on debt would mean that the budget that goes to paying the interest on foreign obligations will likely decline in the coming years, allowing the government to appropriate more funds for more productive endeavors such as building infrastructure projects (roads, hospitals, trains, airports, seaports) that will help create jobs, promote more investments, and hopefully, ease the incidence of poverty.
in paper, these are all good indeed.

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but the reality is something else.
most of the funds that should be going to the construction of roads, bridges, schools, ended up in the pockets of several lawmakers, government officials and their partners in the private sector, most specifically ghost non-government organizations that were funding non-existent projects. local newspapers had reported that an estimated ten billion pesos (a very conservative estimate, mind you) of so-called pork barrel funds in the last several years went to waste, or to be more precise, enriched the bank accounts of a few privileged citizens in the country.
so even if the country succeeds in bringing down the cost of paying its foreign debts significantly, the savings would still not redound to the well-being the majority of the filipino people because the funds will just be stolen by these thieves in the government.
rampant corruption is just one of the bleak issues that overshadowed this latest triumph for the country, which happened amid allegations that even the executive has violated some laws in disbursing money under the newly-coined disbursement acceleration program, which some critics pointed out is just another variant of the pork barrel funds.
that the aquino administration and his allies in congress remain adamant to give in to the people's demand to abolish altogether the pork barrel funds in the budget only made this recent triumph from moody's shallow, if not hollow.
a tad sad, actually, because president aquino ran and won (aside from the strength of the aquino brand) mostly because of his "tuwid na daan" (or straight path) slogan, luring voters in with the promise that he won't steal from the treasury and won't tolerate corruption.
that his first ever act once he was in office was to jail his predecessor gloria arroyo on charges of corruption only strengthened the people's belief that indeed, here is the president that will finally eradicate massive thievery in the bureaucracy that hampered the country's march to progress.
then came the impeachment of chief justice renato corona who was accused of falsifying his statement of assets and liabilities among other charges.
while corona's impeachment was another testament to aquino's bid to stamp out corruption, recent reports also showed otherwise. there were allegations that the president showered lawmakers who voted for corona's impeachment millions of pesos in additional pork, obviously as a show of gratitude for supporting him, with senate president drilon getting as much as one hundred million pesos.
now, what does it all say about his administration's tuwid na daan battle cry?
as the unbeatable senator santiago quipped: that road (tuwid na daan) is nowhere to be found because even the high-tech gps could not locate it.

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then there is poverty. another reason why the investment grade rating is a hollow victory.
you don't need official statistics from the world bank, international monetary fund, the asian development bank and the national economic and development authority to realize that indeed, despite the resilient economy, with growth rates consistently rising since the time of the arroyo administration, poverty remained high. the poor people are growing in number and some are dying of hunger.
the rising number of the poor is also bad for the economy. because they are too poor to go to school, most of them become easy targets for corrupt politicians for vote buying during elections. thus, the vicious cycle of political patronage, political dynasty, vote buying, rampant corruption, and then poverty, continues and will remain until the government does something about it.
according to the world bank's estimates, the country's gdp per capita stood at around $2,587 in two thousand and twelve, the lowest among the original five countries that founded the association of southeast asian nations or asean. indonesia came in fourth with $3,557; then thailand with $5,480; and then malaysia with $10,381. the philippine statistic paled in comparison with singapore, a tiny country with barely enough natural resources to fuel its sizzling economy, with $51,709. imagine that?
(moody's has an updated gdp per capita figures for the philippines at $4,412 and indonesia at $4,636 for two thousand and twelve. while the figures are higher than the world bank data, they are still dwarfed by the median among baa1-baa3-rated countries at $15,078.)
of course, singapore is known for its ironclad rules against corruption. so there is really a co-relation between creating more wealth (and spreading the riches among the citizens) and reducing corruption down to zero. now, if only the philippines can learn a thing or two from the city state.

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let's face it, who needs cheaper borrowing costs when only the wealthy, apart from the government, will benefit from it? when the advantages of a roaring economy is too slow to trickle down to the poorest of the poor. the majority of the poor will probably be dead by the time the so-called trickle down effect has indeed trickled down to their doorsteps.

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so what am i trying to say?
simple. if aquino will only purge the budget of billions of pork barrel funds, send the corrupt public servants (and the tax cheats too) to jail, seize their assets, then the government will have plenty of cash to, among others, alleviate the conditions of the poor, improve basic services such as health and education, fund the construction and the upkeep of the country's sorry infrastructure facilities. our international airport, named after aquino's father, the hero ninoy aquino, remains the among oldest, most congested, least efficient, and even the ugliest in southeast asia, if not in the world.
how do you expect tourists to flock to our shores? investors to come in? when the first thing that they will see is the dilapidated, crowded, inefficient airport upon setting foot in the philippines?

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perhaps the only positive thing that's going on in the country today is the growing repulsion and anger of the citizens for the misuse of pork barrel funds as well as corruption in the government. if this continues, then surely we will someday wake up to a corruption-free government such as the more prosperous singapore, hong kong, south korea and taiwan.

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oh well, lowell, have a lovely friday to all fairies, witches, bitches, queens and wannabes.
see you all at the anti-pork rally in makati tomorrow. ok?

-- for more interesting reads about the philippines, please click here  and here.

(all photos were taken from different websites. no copyright infringements intended. pls inform the blogger if you want your photos removed from this post and other entries. thank you.)