IT was refreshing to hear the incoming Duterte administration’s economic team this week talking about its commitment to retain sound fiscal, monetary and trade policies while advocating tax reforms, speedier infrastructure development, better support services for farmers and a reduction in crime to attract foreign investments.
For far too many days, the news cycle had been dominated by controversial—and often incendiary—statements from President-elect Rodrigo Duterte that raised fears of a dirty war on criminal suspects with no regard for human rights.
But this week, Duterte’s incoming economic managers painted a different picture at a two-day conference with the country’s top business leaders. There, they presented a 10-point socioeconomic agenda that promises to make life better, not only for the crème de la crème, but for ordinary working men and women who have been given short shrift over the last six years.
“The policy of the new government is to reduce tax evasion and smuggling, and [to lower] tax rates. We want to execute projects in the countryside and create jobs there. These goals are not single goals but they are a whole program,” incoming socioeconomic planning secretary Ernesto Pernia said in a media briefing.
The objectives would call for the new government to:
• Continue and maintain macroeconomic policies, including fiscal, monetary and trade policies.
• Institute progressive tax reform and more effective tax collection while indexing taxes to inflation;
• Increase competitiveness and the ease of doing business, drawing upon successful models used to attract business to local cities such as Davao, as well as pursuing the relaxation of the constitutional restrictions on foreign ownership, except with regards land ownership, to attract foreign direct investments;
• Accelerate annual infrastructure spending to account for five percent of the gross domestic product, with public-private partnerships playing a key role;
• Promote rural and value chain development toward increasing agricultural and rural enterprise productivity and rural tourism;
• Ensure security of land tenure to encourage investments and address bottlenecks in land management and titling agencies;
• Invest in human capital development, including health and education systems, as well as matching skills and training to meet the demands of businesses and the private sector;
• Promote science, technology and the creative arts to enhance innovation and creative capacity towards self-sustaining and inclusive development;
• Improve social protection programs to protect the poor against instability and economic shocks; and
• Strengthen the implementation of the Responsible Parenthood and Reproductive Health Law to enable, especially, poor couples to make informed choices on financial and family planning.
These goals are all sensible ones, but it was particularly gratifying to hear the economic managers pay special attention to the need to lower income tax rates and to provide working Filipinos—already the most heavily taxed in the region—more disposable income.
The plan to accelerate infrastructure spending is also most welcome, coming as we are from an administration that has had little to show after six years in office and a public-private partnership program whose progress can only be described as glacial.
The two-day business forum was significant too, in that business leaders were asked to submit recommendations on how the 10-point agenda might be improved.
On a cautionary note, the business community did the same thing under the Aquino administration, providing it with a rather lengthy list of priorities and recommendations, only to have them largely ignored. We can only hope that the Duterte administration fulfills its promise of change in this one key aspect. We hope they have learned to listen.