Before leaving for the World Economic Forum (WEF) in Switzerland, President Ferdinand “Bongbong” Marcos Jr. said he will “highlight the significant economic gains we have achieved in the last part of the year.” He is the only leader eager to attend from Southeast Asia.
The WEF was set up in 1971 as a global multistakeholder group independent of any government and holding high-level annual meetings of public and private decision-makers. It remains to be seen what the folks at the WEF will make of the third poorest country in Southeast Asia sending a reportedly 70-strong delegation to the rarefied heights of Davos and even pitching a sovereign wealth fund.
Not a few will see a throwback to his father’s dictatorship when his family made the public purse their personal kitty. To be sure, unlike his grim predecessor Rodrigo Duterte, the narrative bait of Marcos Jr.’s populism is perpetual brightness and cheerfulness—in public appearances or in the torrent of saccharine digital escapism of his vlogs and other social media detritus.
But in the same way that Duterte’s authoritarian schtick grew tiresome as the body count mounted, the entertainment value of Marcos Jr.’s gimmick will wane as the people’s situation worsens, and unfortunately, things are going to get worse.
The gains Marcos Jr. imagines under his watch are dubious. His administration hasn’t really undertaken any meaningful policy steps yet that would have any traction—not even in the agriculture department which he helms which hasn’t done anything to address soaring food prices and supply shortages.
Most glaringly, the numbers tell a much different story. The president’s emancipation from economic realities is understandable—apart from his family and class background, he didn’t even bother with an economic platform while campaigning and seems to be bluffing whenever he affects knowledge about the economy.
The economic managers, however, certainly know better. Inflation is up to 8.1% in December 2022, which is the highest in over 14 years or since November 2008.
Claims about a strong labor market are meanwhile grossly misleading. The number of jobless Filipinos cannot just be the 2.2 million officially reported as unemployed as of November 2022. At the very least the steadily increasing number of employed but categorized as “unpaid family workers” should also be counted and this grew by 634,000 since June to 4.4 million as of November 2022.
Since Marcos Jr. assumed office, eight out of ten (79.3%) jobs created are in merely part-time work. IbonN estimates that some 36.7 million or three-fourths (74%) of those reported as employed are actually struggling with precarious self-employment (13.4 million) or other informal work as household help (2.1 million), in family farms or businesses (6 million), or irregular workers in unregistered private establishments (about 15.3 million).
Caught between rising prices and failing earnings, the number of poor Filipinos is growing and increased by 700,000 to 12.9 million between June and December 2022. This is over half (51%) of Filipino families and is aside from the 7.8 million (31%) more who are borderline poor – which means that 20.7 million or over eight-of-ten (82%) families are either poor or on the edge of poverty. This jives with how some 18.6 million households don’t have any savings and are basically living hand to mouth.
Economic fundamentals in Marcos Jr.’s last part of the year, where he claimed gains presumably of his doing in his departure remarks, are also trending badly. The national government (NG) booked a Php1.2 trillion deficit in the first 11 months of 2022, with the deficit in the first three quarters slightly smaller than the year before but still equivalent to a high 6.5% of gross domestic product (GDP). NG debt keeps bloating and rose by Php852 billion to Php13.6 trillion between June and November 2022. Clearly no wealth here.
The share of manufacturing to GDP fell to 16% in the third quarter which is the lowest in over 70 years since the late 1940s. As it is, the Philippines has the second smallest manufacturing sector in all of Asean (Association of Southeast Asian Nations), whether measured as a share of the economy or employment. The share of agriculture only rose by a tenth of a percentage point in the third quarter and, at 8.5%, is virtually still down to its smallest share of the economy in history.
This weakness of domestic agriculture and manufacturing underpins the trade deficit growing to a cumulative US$53.7 billion as of November 2022. The US$46.6-billion deficit in the first three quarters of 2022 was already equivalent to 16% of GDP and the country is on track to the largest annual trade deficit in its history.
The country’s current account deficit has also already soared to a record 6.1% of GDP as of the first three quarters of 2022. Similarly, the balance of payments deficit has ballooned to US$7.9 billion in the first 11 months of 2022 which is set to become the worst deficit, measured as a share of GDP, since the early 1980s crises under Marcos Jr.’s father. Again, clearly no wealth here.
Malacañang’s disinformation machinery has already telegraphed the tired foreign-travel trope that the president will “bring home more investment pledges” from the WEF, even if this is nowhere near the kind of forum for that.
In his eight international trips so far to eight countries over the last four and half months, we are made to believe that his posturing and preening has generated US$46.4 billion in investments. This is more than in the last five years from 2018-2022 and over 23 times the amount of foreign investment that the Philippines got over the entire Marcos regime from 1966-1986.
Marcos Jr. might very well claim more such fantastic amounts upon his return from Switzerland. If so, he will almost certainly say this is from keen investor interest in his dubious and pretentious Maharlika fund.
The administration’s trip is a self-serving junket at the people’s expense. If Marcos Jr. speaks about so-called economic gains, he will be speaking untruths. If he says that there is a wealth fund for investors to make money from, it is the arrogant claim of an autocrat. If he says that the Philippines will be a driver of growth, it is a robotic repeat of vlog-friendly but empty economic propaganda. But they know all this.
In the end, it’s up to us to make sure that Marcos Jr. and his family and cronies aren’t allowed to be laughing all the way to the banks, which there are a lot of in Switzerland.