DuterteNomics

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DuterteNomics is a catch-all term referring to the socioeconomic policies of President Rodrigo Duterte. A significant part of the policy includes the development of infrastructure and industries.[1]

Background[edit]

Finance Secretary Carlos Dominguez has said that the government required what he describes as an "audacious" economic strategy in order for the Philippines to "catch up with its more vibrant neighbors" by 2022 and help it achieve high-income economy status within a generation. The term DuterteNomics was coined to describe the economic policy of the Duterte administration. The term also refers to the series of forums where Duterte's economic team pitches the administration's plan to help the country become a high-middle-income economy by 2022.[2]

The policy was unveiled on April 18, 2017, by the Department of Finance and the Presidential Communications Operations Office (PCOO), in cooperation with the Center for Strategy, Enterprise and Intelligence (CenSEI) in a forum held at Conrad Manila in Pasay. A second forum was held on April 25, 2017.[2]

DuterteNomics was also pitched abroad, particularly at the 2017 World Economic Forum on the Association of Southeast Asian Nations in Cambodia and at the sidelines of the 2017 One Belt One Road Forum for International Cooperation in Beijing, China.[2]

Ten-point agenda[edit]

The economics team of then President-elect Rodrigo Duterte presented the following points of Duterte's socioeconomic policy in a business forum in Davao in June 2016.[3] DuterteNomics is anchored on these ten principles.[2]

  1. Continue and maintain current macroeconomic policies, including fiscal, monetary, and trade policies.
  2. Institute progressive tax reform and more effective tax collection, indexing taxes to inflation.
  3. Increase competitiveness and the ease of doing business.
  4. Accelerate annual infrastructure spending to account for 5% of GDP, with Public-Private Partnerships playing a key role.
  5. Promote rural and value chain development toward increasing agricultural and rural enterprise productivity and rural tourism.
  6. Ensure security of land tenure to encourage investments, and address bottlenecks in land management and titling agencies.
  7. Invest in human capital development, including health and education systems, and match skills and training.
  8. Promote science, technology, and the creative arts to enhance innovation and creative capacity.
  9. Improve social protection programs, including the government's Conditional Cash Transfer program.
  10. Strengthen implementation of the Responsible Parenthood and Reproductive Health Law.

Build! Build! Build! Infrastructure Plan[edit]

Part of DuterteNomics is the Build! Build! Build! Infrastructure Plan which according to the administration will usher in the "Golden Age of Infrastructure". The goals of the program are to reduce poverty, encourage economic growth and reduce congestion in Metro Manila.[4]

Associated projects[edit]

Transportation related projects[edit]

Railways[edit]
Roads[edit]
Airports[edit]

Non-transportation related projects[edit]

  • Kaliwa Dam[16]
  • Cavite Industrial Area Flood Risk Management[16]
  • Leyte Tide Embankment[12]
  • Lower Agno River Irrigation System Improvement Project[10]
  • Rio Grande de Mindanao[7]

Economic trends[edit]

Economic outlook[edit]

In December 2017, government data revealed that the Philippines' output of nickel ore fell 16 percent in the third quarter from a year earlier, after the country, which is the world's top supplier of the metal, suspended some mines in a clampdown on environmental violations. Production dropped to 19.8 million tonnes in the nine months to September from 25.97 million tonnes a year ago, according to the data.[17] According to Finance Secretary Carlos Dominguez, the "Philippine economy is delivering the performance we anticipated, notwithstanding the political noise and a significant terrorist event in Mindanao". Dominguez gave the assessment during the Banyan Tree Leadership Forum of the Center for Strategic and International Studies.[18]

On March 31, 2018, the Financial Times reported that the export of the Philippines has continued its drastic drop for the fifth month in a row,[19] while the Philippine Statistics Authority reported that the trade deficit of the country has widened to 47.6%, endangering further the country's local economies.[20]

In October 2018, the World Bank downgraded the economic outlook of the Philippines for 2018, but expects it to remain strong.[21] FMIC and UA&P expect the economy to improve in the second half of 2018.[22]

In November 2, 2018, the Philippines slipped 11 places from the World Bank's Ease of Doing Business rankings.[23][24] The Department of Finance is demanding a correction from the World Bank, citing the smaller data set used to assess the country's credit base.[25][26]

Inflation rate[edit]

In May 2018, the inflation rate of the Philippines reached 4.6%.[27] In June 2018, within less than a month, the inflation rate increased to 5.2%.[28] In August 2018, the inflation rate of the country hit 6.4%, a nine-year high, causing ripples to the Philippine economy and diminishing the strength of the Philippine peso.[29][30] In October 2018, the inflation rate skyrocketed to 6.7%, its highest in a decade.[31] Inflation reached its peak in the third quarter of 2018 to 6.2%.[32][33] It is expected to decrease by the fourth quarter of 2018.[32][33]

On the entrance of July, the inflation rate of the country increased to 5.7%.[34][35] Additionally, the country's foreign exchange reserves dipped to a six-year low due to weakening peso.[36] In July 5, the inflation rate of the country soared to 5.2%, its highest in 5 years.[37] The inflation rate worsened the impacts of the government's new tax policy, increasing the price of all goods in the country.[38]

In September 2018, the inflation rate of the country skyrocketed to 6.7%, its highest in a decade, effectively damaging the economy.[39][40] President Duterte blamed American president Donald Trump for the inflation increase.[41] Senator Francis Pangilinan, however, pointed out that if the United States was to blame, then all countries in ASEAN should have been experiencing the same. Only the Philippines has a very high inflation rate in the entire region.[42] On September 21, 2018, Duterte signed Administrative Order No. 13, removing non-tariff barriers in the importation of agricultural products, to address soaring inflation rates.[32][43]

According to ING, with food prices decreasing, the worst of the inflation crisis is over.[44] Inflation decreased in November 2018, at 5.8 to 6.6 percent.[45] BSP decreased its inflation forecast for 2019, after the passage of the rice tariffication bill.[46]

Inflation decreased further to 5.1% in December 2018[47][48] and to 3.8% in the first quarter of 2019.[49]

Income status[edit]

Economic managers predict the accession of the Philippine economy to upper-middle-income status by 2019, citing massive infrastructure spending and robust growth, despite increasing inflation rates.[50][51][52]

See also[edit]

References[edit]

  1. ^ "Home". Build!. Retrieved June 28, 2017.
  2. ^ a b c d "TIMELINE for Duterte's economic agenda". The Manila Times. May 29, 2017. Retrieved June 28, 2017.
  3. ^ Macas, Trisha (June 20, 2016). "Duterte's economic team reveals 10-point socioeconomic agenda". GMA News. DVM, GMA News. Retrieved June 28, 2017.
  4. ^ "DuterteNomics unveiled". Presidential Communications Operations Office. April 19, 2017. Retrieved June 28, 2017.
  5. ^ Rosario, Ben (May 12, 2017). "P300-B subway project planned in Dutertenomics". Manila Bulletin. Retrieved June 28, 2017.
  6. ^ a b Vera, Ben O. de. "34 of 75 flagship infra projects to start in '18". Retrieved May 30, 2018.
  7. ^ a b "Sign of tangible progress in 'Build, Build, Build' - The Manila Times Online". www.manilatimes.net. Retrieved August 4, 2018.
  8. ^ Bagaforo, Nelson C. (June 26, 2017). "Mindanao railway project gets support". SunStar. Retrieved September 3, 2017.
  9. ^ "DOTr: Then and now". Manila Bulletin News. Retrieved May 30, 2018.
  10. ^ a b News, Michelle Ong, ABS-CBN. "12 to 15 major infra projects to roll out in 2018, says NEDA". ABS-CBN News. Retrieved May 30, 2018.
  11. ^ a b c d Kabiling, Genalyn (May 13, 2017). "China plans construction of 5 infrastructure projects". Manila Bulletin. Retrieved June 28, 2017.
  12. ^ a b c d e f g "What is 'Build, Build, Build'?". Manila Bulletin News. Retrieved May 30, 2018.
  13. ^ a b c d e f g h i j k Admin. "WATCH: Luzon Spine Expressway Network is Duterte's P107-billion traffic decongestion plan". The Summit Express. Retrieved August 25, 2018.
  14. ^ "SMC's South East Metro Manila Expressway project begins". Inquirer. Retrieved January 8, 2018.
  15. ^ "Metro Manila Subway leads expected infra buildup in 2018". Rappler. Retrieved December 28, 2017.
  16. ^ a b "NEDA eyes 6 big infra project rollouts, 8% GDP growth in 2018". Rappler. Retrieved December 28, 2017.
  17. ^ "Philippines third quarter nickel ore output drops 16 percent as Duterte's green clampdown bites". Reuters. December 5, 2016 – via Reuters.
  18. ^ "RP economy weathers political noise". October 16, 2017.
  19. ^ "Subscribe to read". Financial Times. Retrieved July 17, 2018.
  20. ^ "Philippines' trade deficit widens by 47.6% in May 2018". Rappler.com. Retrieved July 17, 2018.
  21. ^ https://www.rappler.com/business/213492-world-bank-2018-economic-outlook-philippines
  22. ^ "FMIC, UA&P: Philippine economy may 'rebound' in H2, but not without 'bumps' | Philstar.com". philstar.com. Retrieved October 12, 2018.
  23. ^ "PH slips 11 notches in World Bank's ease of doing business ranking". Rappler. Retrieved November 4, 2018.
  24. ^ "Philippines ranking falls in Ease of Doing Business | Philstar.com". philstar.com. Retrieved November 4, 2018.
  25. ^ News, ABS-CBN. "Philippines 'demanding a correction' from World Bank: Trade Sec Lopez". ABS-CBN News. Retrieved November 4, 2018.
  26. ^ "PHL protests Ease of Doing Business survey results, demands World Bank review of credit coverage data". BusinessMirror. Retrieved November 4, 2018.
  27. ^ https://www.rappler.com/business/204113-inflation-rate-philippines-may-2018
  28. ^ https://www.rappler.com/business/206518-inflation-rate-philippines-june-2018
  29. ^ https://www.rappler.com/business/211176-inflation-rate-philippines-august-2018
  30. ^ https://www.rappler.com/business/211176-inflation-rate-philippines-august-2018
  31. ^ https://www.rappler.com/business/213554-inflation-rate-philippines-september-2018
  32. ^ a b c News, ABS-CBN. "Inflation at 6.2 percent for third quarter of 2018: BSP". ABS-CBN News. Retrieved October 20, 2018.
  33. ^ a b "Q3 inflation highest for the year at 6.2%". cnn. Retrieved October 20, 2018.
  34. ^ https://www.rappler.com/business/208989-inflation-rate-philippines-july-2018
  35. ^ http://www.gmanetwork.com/news/money/economy/663222/july-inflation-at-5-7-fastest-in-at-least-five-years/story/
  36. ^ http://www.bworldonline.com/philippines-fx-reserves-dip-in-july/
  37. ^ "June 2018 inflation soars to 5.2%". Rappler.com. Retrieved July 17, 2018.
  38. ^ "Inflation jumps to new 5-year high in June, beats forecasts - Philstar.com". Philstar.com. Retrieved July 17, 2018.
  39. ^ "Inflation in September 2018 strains Filipinos' budget at 6.7%".
  40. ^ "Inflation soars to new 9-year high of 6.7% in September".
  41. ^ https://news.abs-cbn.com/news/09/07/18/duterte-blames-trump-for-high-inflation-in-ph
  42. ^ https://news.abs-cbn.com/news/09/09/18/pangilinan-slams-duterte-for-blaming-inflation-on-trump
  43. ^ "Duterte cuts red tape in importing agricultural products". Rappler. Retrieved October 20, 2018.
  44. ^ Lucas, Daxim L. "Worst is over for PH inflation crisis as food prices ease, ING says". Retrieved October 27, 2018.
  45. ^ News, ABS-CBN. "Inflation likely at 5.8 to 6.6 percent in November: BSP". ABS-CBN News. Retrieved November 30, 2018.
  46. ^ News, ABS-CBN. "Bangko Sentral drastically lowers 2019 inflation outlook". ABS-CBN News. Retrieved November 30, 2018.
  47. ^ Rivas, Ralf. "Inflation cools down to 5.1% in December 2018". Rappler. Retrieved January 4, 2019.
  48. ^ News, ABS-CBN. "Easing inflation, rate hike pause make PH more attractive to investors". ABS-CBN News. Retrieved January 4, 2019.
  49. ^ "3.8% Q1 inflation rate validates BSP rate stance". Manila Bulletin Business. Retrieved April 27, 2019.
  50. ^ "Philippines set to become upper middle-income economy by 2019". Manila Standard. Retrieved October 12, 2018.
  51. ^ "Philippines to become upper-middle income country by 2019 – Pernia". Rappler. Retrieved October 12, 2018.
  52. ^ News, ABS-CBN. "PH to be upper-middle income country in 2019, Pernia says". ABS-CBN News. Retrieved October 12, 2018.