"The government is the richest and largest corporation in the Philippines."Bangko Setral ng Pilipinas Governor Benjamin E. Diokno had a rather bullish speech at the Rotary Club of Manila meeting last June 6. Economic growth as measured by the rate of increase in the Gross Domestic Product or the output of goods and services in a given period has slackened, with the GDP rate falling from a high of 7.6 percent in 2010 to 6.9 percent in 2016,6.7 percent in 2017, and 6.2 percent in 2018. And to 5.7 percent in the first quarter of 2019. The sharp decline in growth rate to 5.7 percent in January-March 2019 has been blamed on the delayed approval of the P3.7-trillion national budget. To me, the reasons for the drop are more fundamental than simple legislative red tape. One reason I suspect is that a huge chunk of government money is being stolen by government bureaucrats who deny its use by the population and the economy. The government today contributes close to 20 percent of economic production. But that 20 percent is only part of the story. It represents money being actually spent or invested by government, not only for payroll, not only for maintenance and operating expenses, but also for buying machinery and equipment and in building infrastructure. When government fails to buy equipment or build infrastructure, the economy and the people suffer. A classic example is the incompetent NAIA management. In August last year, a Chinese jet crash-landed at the airport. NAIA had no tow truck or forklift to remove the paralyzed jet away from the runway. So flights were canceled for three days. My estimate of the cost of the closure: P5 billion. Last Sunday, lightning or fear of lightning gripped NAIA. So the airport was closed for a few hours and scores of flights were diverted, delayed or prevented from taking off and landing. Why? NAIA has no equipment to deflect lightning. Can you believe that? President Duterte was so furious he rushed to the airport himself in the middle of the night. He found the terminals a total mess. He was kind, though. Nobody was fired—yet. He apologized to the NAIA customers—the airline passengers. It is not for lack of money that NAIA could not buy a forklift for planes or a lightning deflector. The government is the richest and largest corporation in the Philippines. The budget for a forklift or a lightning should be petty cash. So here now is BSP Governor Ben Diokno: “While the Q1 2019 growth of the Philippine economy of 5.6 percent was short of our target of 6 percent to 7 percent, it remains one of the highest in the region and perhaps the world. This performance was achieved notwithstanding the delay in the approval of the 2019 national budget which held back the implementation of key programs and projects. “The Philippine economy should have grown by at least one percentage point higher, at 6.6 percent to 7.2 percent in the first quarter, had the 2019 fiscal program been approved on time. “The government has crafted a ‘catch-up’ plan to make up for the lower-than-planned state spending in the first quarter. And the consensus is that we will hit our target of 6 percent-7 percent growth this year.
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