Aquino legacy: inclusive growth, or crash and burn?

RECENT reports seem to point to an urgency to expand and build our infrastructure. Our mass transport system like land (bus, jeep etc.), rail (like PNR, MRT, LRT) air and sea are feeling the strain of over use and lack of maintenance. The facilities and infrastructure that house and facilitate these transport systems like airports, sea ports and roads and terminals are bursting in the seams.

All this points to an overload of our current infrastructure… not just road, bridges, railroads and the like – but the whole caboodle.

A new airport on reclaimed land as proposed by San Miguel Corporation, seconded and with willing prospective support from SM. In the back burner? Photo from SMC’s presentation.

A new airport on reclaimed land as proposed by San Miguel Corporation, seconded and with willing prospective support from SM. In the back burner? Photo from SMC’s presentation.

In 2004 (if my memory serves me right) I came across a study by Booz Allen and Hamilton about infrastructure. It said that there are two kinds of infrastructure: Hard infrastructure which are the physical structures like roads, airports, physical facilities; and Soft infrastructure such as the array of policies, incentives, telecommunications and general environment. The old Subic Bay Free Economic Zone was cited in that study as a prime example of soft infrastructure, yet it was not enough for the country to take off because it was not backed up by enough build up in the rest of the country.

Fast forward to many years later, the country has fallen back on building up its infrastructure – soft and hard – that would keep up with the country’s growth pattern. For one thing, population growth – generally placed at just below three percent a year – has constantly and slowly put a strain on all resources. But about two to three percent economic growth over those years has kept us on a general flux and thus the strain on our infrastructure has been manageable.

However, in recent years – and I have no reason to doubt the numbers of the Aquino administrations economic managers – the economy has been growing at a tad below seven percent which is good thing. But since our infrastructure has been practically dormant save for the TPLEX, the belated current construction of the Skyway extensions and some smaller projects that have been appointed many years ago and are only being competed now, infrastructure build up has not been fast enough to keep up with demand.

Take for example reclamation projects. These aren’t just new land masses created on our waters. They are viable projects that will facilitate the creation of viable infrastructure like airports, sea ports, business centers and the like. It addresses urban blight by providing much needed land for new and more organized building facilities, providing employment and economic activity.

While many have actually put their money where their mouth is in these reclamation projects it seems government – specifically the Department of Environment and Natural Resources (DENR) – is sitting on any processing and approvals of permits. It’s doing so not because it has deemed the projects unfit or dangerous. It even isn’t doing so because they’re trapped in analysis paralysis – having so many conflicting pros and cons that they don’t know which way to decide.

No, the DENR and its leadership aren’t doing anything – not acting, processing and even studying – because they don’t want to be mired in any kind of possible controversy for the President in his last couple of years in office.

Less talk, less mistake. No action, no reaction.

And it seems government as a whole is in that mode. Rather than fast track needed infrastructure it is pretending that the elephant in the room does not exist. Just look at the way The Department of Transportation and Communications (DOTC) and its leaders are treating the MRT, LTO, LTFRB and telecoms controversies.

In the late 1980s, after the Marcos dictatorship saw the pull out of many foreign investments in the country, the car industry practically collapseds. The little of this industry we had which was end use assembly of Semi Knock Down (SKD) kits just closed down. For many years we had no new vehicles and the second hand car market sky rocketed. But many lost their jobs at the closure of the assembly plants of  Ford, Nissan and Toyota.

In the early days of the Cory Aquino government there were moves to encourage foreign investments to come in to shore up the economy, its main draw was the goodwill of the new government. However, this was initially stalled by certain government functionaries that were actually against opening the economic opportunities to foreigners.

Their reason was quite disturbing, if not downright insane: They did not want investments to come in at the risk of them closing down again and leaving people without jobs again.

How stupid was that?

And now this, government inaction, especially with infrastructure projects long needed, not coming online simply because they want to avoid controversy. How on earth will they push their “inclusive growth”, which President Benigno Aquino III so proudly emphasized at the World Economic Forum, when the most basic infrastructure is not being addressed?

Mass transport, urban development, road and rail networks, airports and sea ports, land reclamation, communications… infrastructure just pending because nobody wants to create controversy for this outgoing administration is actually going to create a very negative legacy – crash and burn. And that cannot be undone.

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