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Friday, June 14, 2024

Biden to the rescue

"Still the world’s best salesmen."

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Congratulations first of all to our wunderkind friend Dr. Karl Kendrick Chua, who breezed through his Senate confirmation last week as NEDA director-general. His sponsor, Senator Ralph Recto—a former NEDA head and no mean looker himself—praised Karl’s “K-Pop looks” as well as his skills in development economics.

Sec Karl has his job cut out for him. Abroad, the OECD is expecting global growth to hit 5.3 percent this year—the highest in nearly five decades—settling down to 4.4 pct next year. Unfortunately, we’re still lagging well behind our emerging-market peers, by as much as a whole year. Exports will contribute to the growth of all six major ASEAN economies, according to Oxford Economics, but the contribution of exports to GDP, at only 2.7 percent, will be the smallest in our country.

It will thus still be a good idea for Sec Karl and his colleagues in government to talk down the peso and take other policy measures to keep its value down, such as by keeping interest rates low even if lenders still aren’t confident enough to put money out. This would benefit exporters as well as the OFWs and BPO sector on which we rely so much.

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A major reason for the performance gap between rich and poor countries is the growing inequity in availability of vaccines. This is why we ought to welcome the latest announcement from the White House that the US will ship out some 80 million doses this month, starting with 25 million surplus doses that “live free or die” Americans still aren’t willing to take.

Of course, it makes commercial sense for the pharma companies to make money abroad off those unwanted vaccines before they expire. And for context, it was really China that led the way—without fanfare–by exporting or donating nearly half their total production of 200 million-plus doses, including the 5 million doses that were the very first vaccines to hit our country. But that didn’t stop President Biden from intoning:

“We are sharing these vaccines to save lives and to lead the world in bringing an end to the pandemic, with the power of our example and with our values.”

It was an entertaining display of American exceptionalism, always evident no matter who’s sitting in the White House. As ever, Americans are the world’s best salesmen.

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Now that the leader of the free world is on board, we can breathe a little easier. Vaccine czar Sec Carlito Galvez says the government no longer needs to share the 50 pct of vaccines earlier committed by the private sector. Businesses can now vaccinate more employees under presumptively more focused and efficient arrangements.

The urgency of rolling out those doses is heightened by the continuing discovery of ever-newer variants of the COVID virus, ever since they started emerging late last year. The latest discovery is a hybrid of the Indian and British strains that, according to Vietnam’s health minister, “spreads very quickly and strongly in the air.”

The reason for this is beyond doubt:  The continued exponential rise in cases globally. Every new COVID-19 case gives the virus a chance to mutate, and if the number of infections continues to rise, more new variants may emerge. This is why—say what you will about the Dengvaxia debacle a few years back—vaccine hesitancy is no longer a laughing matter.

On top of it all, China has just reported the first-ever human infection with the H10N3 strain of bird flu. Authorities are playing it down, and even the US CDC hasn’t issued any warning. But recalling how quickly the COVID infection spiralled out of control, we just can’t be too careful with this new threat.

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All this foreboding news practically obligates us to close on an upbeat note. We see that in the President’s new executive order to push ahead with the long-planned devolution of various national government functions to local governments.

Under EO 138, all national agencies must review their respective mandates for devolution under these principles:

1. Public services with little benefit spillover are best administered by lower level governments.

2. Public goods and services with economies of scale are best assigned to higher levels.

3. Redistributive functions belong to the national government.

This order simply responds to the Supreme Court “Mandanas decision”—no longer reversible—to transfer a significant share of revenue collections to the LGUs. With this revenue loss, and without downloading some of its functions, the national government would quickly run up unsustainable fiscal deficits.

But going beyond fiscal considerations, what meaningful devolution does is to bring resources, decision-making, and accountability closer to the people, through their governors and mayors and barangay captains. The lockdown of the last two years has painfully reminded us where the real frontliners of government service are. It’s about time those frontliners were properly resourced and recognized.

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