Is APEC stepping stone for Philippines’ inclusive growth?

With just about one more month to go before the heads of 21 member-countries of the Association of Southeast Asian Nations (Asean) meet in Metro Manila, the atmosphere in the metro is slowly getting into the frenzy of preparations for the two-day event.

You get the feeling when the government suspends classes at all levels for four days – from Nov. 17 to 20 – and when Nov. 18 and 19 are declared as non-working holidays. But more than that, there’s the build-up of more important activities that will signal the end of almost a year of work that started in early December.

The Asia-Pacific Economic Cooperation (APEC) Philippines 2015 was formally launched on Dec. 1, 2014 with President Benigno Aquino III hosting a dinner event in Makati City and declaring the theme, Building Inclusive Economies, Building a Better World.

APEC is now considered as one of the more vibrant economic activities that foster the cooperation of a core of nations bonded geographically, in this case, those within the Asia-Pacific region. In the roster of founding member-countries, only the United States and Canada are outside the AP ambit.

Today, it is ever more committed to creating and maintaining growth and prosperity among its member economies. It is also committed to free trade and open trade and investments in the Asia-Pacific by 2010 for industrialized economies and 2020 for developing economies.

A bit of trivia: before the 2015 meet, the Philippines’s first and only other hosting of the APEC was in 1996, at a time when the country was seen as Asia’s rising economic tiger under the leadership of then President Fidel V. Ramos.

Real leap

Hopefully, the hosting this year will become a true stepping stone for the country to get in a better groove for that much-aspired leap to becoming a true tiger economy. Since 2010, the Philippines has been exhibiting robust economic growth, which is much better than what even developed economies have chalked.

In 1996, remittances of Filipino workers abroad was only at P35.2 billion, a far cry from the P1.2 trillion that has been recorded in 2014. In recent years, especially during the global financial crisis, the salaries repatriated by Filipinos working abroad have been instrumental in keeping the local economy alive.

While there have been some slight dips in remittances in recent months, the amount is still significant to prop up what has now become as one of the largest consumer buying-led economies in the world. And these remittance levels are not expected to significantly change for the worse in the short term.

Meanwhile, and at last, things seem to have started moving for the Philippine economy, especially in terms of infrastructure spending and new investments, plus the rise of the business processing outsourcing service sector.

Firm legs

All these would seem to be firmer legs from which the Philippines now stands, and this time hopefully would be able to withstand political shocks that could arise from a change in the government’s leadership, such as from the 2016 presidential elections.

While the country continues to decry its lack of a strong manufacturing and industrial base that would ensure sustainable jobs for its growing population of workers, the OFW remittances as well as the strong employment in BPOs is responsible for the growing affluence of the middle class as well as the improvement in poverty levels.

This is reflected in the remarkable boom in the property sector over the last decade, not just for new housing but also in office and commercial buildings. And of course, there’s also the growth in new malls as well as car sales, all proof that more Filipinos have more expendable earnings.

‘Bayan ba o sarili?’

Despite all the optimism about the Philippine economy’s future, many Filipinos still belong to near-poverty and low-income levels. Rightfully, this should be a major concern not just of our government officials, but every Filipino.

As the historic Hen. Juan Luna had asked in the now critically-acclaimed movie bearing his name, bayan ba o sarili? This too is a question that we as Filipinos must ask ourselves to be able to leverage the ongoing APEC meetings for greater prosperity for our countrymen.

Recycling SME initiative

It is laudable the Philippines has initiated the inclusion of micro, small and medium sized enterprises (MSMEs) in the ongoing APEC discussions, in particular having APEC trade ministers endorse the “Boracay Action Agenda to globalize MSMEs” last May.

This may seem like the latest buzzword for APEC, but in reality, it looks like an extension of the old, tired SME initiative that has been kept in its stagnated state.

Simply put: If small, and even some medium sized enterprises have continued to suffer from inclusion with the opening of trade barriers among nations, what more for micro enterprises? However, don’t let this old fogey dampen the euphoria on the MSME coup.

The better mindset, for me, would be to choose the best small and medium sized companies that deserve to be given the opportunity to grow, give them the support, and commit them to giving back tenfold or more to the country in terms of jobs and wealth creation.

And when these are on their merry way to being in the Philippines’ list of the Top 500 companies, then let’s pick a new batch – until we will be seeing clearer pathways that can ensure the faster inclusion of more and more small and medium sized enterprises in the global economy.

What other ways to achieve inclusive growth?

Actually, this is already a strategy being employed by our trade bureaucrats, but in a less organized, low key, and spotty assistance. We need to improve on this to maximize the efforts of our government officials, and more importantly, to realize quantum leaps.

It’s pathetic how we send trade missions with a handful of small entrepreneurs whose main concern is to be able to make a few bucks from the sale of their products and recover the expenses that come with participating in such events.

If we send a manufacturer of footwear or food, for example, in such missions, let’s make sure they have the potential to grow in a global environment. This means that they have the price points and other competitive edge to be appreciated by a bigger market.

I’m sure there are other ways that inclusive growth for Filipinos through APEC may be possible, and like the traffic problem, let’s ask our countrymen to start putting on their eureka cap – and send them to this column for sharing. –Rey Gamboa (The Philippine Star)