RP not ready for social market economy—experts

The Philippines is not ready yet to adopt a “social market economy” system as it does not have the necessary conditions in place, economists said.

In a forum on Tuesday, Emmanuel de Dios, University of the Philippines School of Economics dean, said the country’s bureaucracy is still “incompetent, corrupt or both” that “social justice”—one of the core conditions in a social market setup—will unlikely be met.

“A social market will just degenerate in the country where rent-seeking schemes and other forms of corruption are prevalent. Political endeavors are mostly rent-seeking rather than genuinely for the good,” de Dios said.

Joseph Anthony Lim, an economics professor at the Ateneo de Manila University, said “the Philippines does not have the preconditions for a social market economy yet.”

A social market economy is one that aims economic welfare and social justice for all as well as protection for the environment, Dieter Benecke, an expert on the subject, said.

Benecke said the neo-liberal setup, which is in place in most economies including the Philippines, has “failed” in both developed and developing nations, as seen in the global financial crisis.

“[The neo-liberal approach caused] sub-prime mortgages and the financial crisis, poisoned products, widened the gap between rich and poor, and bred greed,” he said.

He added that this crisis is a good time to determine what economic system will be better for the country. “We are at a crossroad and we should decide where to go in the future. Certainly, we can’t go back,” Benecke said.

Even though the Philippines is not yet ready, “a social market economy is compatible with our Constitution,” and pursuing social justice is provided under Section 1, Article 12 of the Charter, Ma. Lourdes Sereno, Asian Institute of Management Policy Center executive director, said.

However, Sereno said the government’s implementation of these social justice measures is lacking.

“If the State fully complies with the Constitution’s social justice policy mechanisms, there will be no problem in adopting a social market economy,” she said. — Ben Arnold O. de Vera, Manila Times