"Secretary Pernia has advised his people to “look at the big picture” and not get caught up by minutiae."
"Secretary Pernia has advised his people to “look at the big picture” and not get caught up by minutiae."
Good news from the World Bank last week, as the Philippines climbed by a record 29 notches to capture 95th place out of 190 economies covered by this year’s ease of doing business (EODB) survey by the Bank.
This strong showing was fueled by significant improvements in the following areas: getting credit; protecting minority investors; and securing construction permits. It reflects in part a catching-up by the Bank with complaints aired by our officials over the methodology of last year’s survey, though implemented only this year. Nonetheless, the achievements are real.
On the credit access issue, Finance Secretary Dominguez credited the recent passage of the new Personal Property Security Act (PPSA) to allow micro, small, and medium enterprises (MSMEs) to collateralize their bank borrowings with moveable assets. This has got to be welcome news to small entrepreneurs with few property assets to offer a banking system that is traditionally fixated on real estate collateral.
As to construction permits and other licenses issued by government, Trade Secretary Lopez—whose agency also oversees the local construction industry—promised even more improvement with the recent establishment of the Anti Red Tape Authority.
Still another area where we might also do better, the World Bank suggests, is to reduce the time period for settling commercial dispute from the current average of 962 days in our country, bringing it closer to the much lower average of 568 days for the East Asia and Pacific region. The Bank suggests automating the filing of court claims, something that we ought to have done by now and on which, unfortunately, we still scored zero.
Between Secretaries Dominguez and Lopez, we look forward to seeing our EODB scores advance to perhaps even the top quartile (number 45 or better) by the time Duterte leaves office in 2022. That would be a worthy going-away gift to him.
* * *
Another course correction involves government’s highly-touted Build Build Build program. Sad to say, the hype has far outstripped actual results on the ground, with only a few projects being started, let alone completed. Everyone has come in for their share of blame on this: from bureaucratic planners and government lawyers, to front-line agencies plagued by lack of technical staff and internal red tape, to the discreet machinations of this or that business group pulling down their competitors.
Moving past the mid-point of the Duterte presidency, NEDA Secretary Ernesto Pernia has finally summoned up the gumption to push for two major course corrections, if Duterte wants to leave office with less flash and more substance under his belt.
The first correction is for government to become more open to private public partnerships (PPP) as a viable mode for building out infrastructure, in lieu of—or in addition to—government’s preference to do it by themselves.
Wanting to go it alone in part reflects government’s allergy to assuming contingent—let alone real—liabilities to their private sector partners and consumers. This translates into an obsession with perfecting contracts to the minutest detail, no matter how long it takes. This may be basic due diligence in investment banking—the professional background of certain Finance Department senior officials—but not the best thing for building infra projects as quickly as they should.
To address this malaise, NEDA Secretary Pernia has advised his people to “look at the big picture” and not get caught up by such minutiae. We can only hope that the armies of lawyers who man the different agencies also take his advice to heart.
The other correction is lengthening the Build Build Build project pipeline, from some 75 big-ticket items to over a hundred projects that are smaller and more feasible, like shorter roads and bridges. Pernia is going after projects with high multipliers, and he also clearly understands the value of getting something—anything—done earlier rather than later.
Again, more of such smaller projects will be another worthy gift for Duterte when he steps down. And again, we hope that all those government lawyers will listen.
* * *
In the first reading today (Romans 8: 18-25) Paul seeks to inspire the Christians of Rome—living right in the center of imperial persecution—with the reassurance that “the sufferings of the present time are as nothing compared with the glory to be revealed to us.” This glory is nothing less than the very purpose of creation itself, “to be set free from slavery to corruption” that was its original, and still is its current, state.
It is a movement through time that is as natural as nature itself—unseen by human eyes, so that, by believing in it only through hope, we too may be saved. In the gospel (Luke 13: 18-21) Jesus Himself compares it to the leavening of yeast into nourishing bread, or the growth of a mustard seed into a large bush that shelters the birds of the sky. Through Jesus, we join ourselves in hope to the unfolding of nature’s salvation by God’s grace.
Readers can write me at gbolivar1952@yahoo.com.