“We eagerly await the outcome of the elections on Monday.”
How do foreign analysts view the country’s economic and political prospects under a new administration starting July 1?
Two think-tanks—FocusEconomics, based in Barcelona, and Goldman Sachs, based in New York—offer contrasting views on the post-election scenario based on the assumption that either of the two frontrunners in recent opinion surveys are likely to win in the crucial May 9 political exercise.
Their views are worth noting, even if they are from the outside looking in, since these reflect sentiments from potential investors entering the country from Europe and the United States.
FocusEconomics believes that Ferdinand Marcos, Jr., who is leading in opinion polls, has been unable to present clear economic policies in contrast to the detailed policy platform of his main competitor, Vice President Leni Robredo.
“Investor perceptions of Marcos appear weak, raising market jitters; in a recent Bloomberg poll, most economists preferred a Robredo presidency given Marcos Jr.’s poor record during his six years as senator…Perhaps the most salient aspect of Marcos Jr.’s economic policy platform is its lack of clarity.”
The think-tank pointed out that Marcos Jr. had “refused to conduct traditional pre-election debates and has participated in few interviews.”
“The website for his candidature contains no clear overview of his policy pledges. Meanwhile, his record in office is generally considered to be poor — nearly 70 percent of the laws he pursued in the Senate were connected with festivals and holidays, renaming roads and redrawing borders of provinces and cities, according to the New York Times. This suggests the potential for lackluster governance if elected and could feed into investor uncertainty, dampening private investment,” FocusEconomics said.
In its April 26 report, the group lamented that “elections in the Philippines are generally decided based on the candidates’ charisma and personalities rather than their economic platforms, with the country’s mostly sound macroeconomic policy framework unlikely to change drastically regardless of who wins.”
At the same time, FocusEconomics said that “the policy platform of Leni Robredo—who as vice president rolled out a major anti-poverty program and managed part of the government’s COVID-19 response—contains far greater detail…Some of Robredo’s key policies are cracking down on corruption, reducing red tape and strengthening the antitrust watchdog in order to improve market competition and the ease of doing business. Her pledges also include boosting investment in climate change adaptation and high-tech companies—suggesting a forward-looking agenda—plus beefing up the unemployment insurance scheme.”
From another direction, this time from New York, Goldman Sachs noted that Marcos Jr.’s plans for the country’s economic future appear to be a continuation of Duterte policies in general, while a Robredo n administration could mean a significant shift with her comprehensive plan to free the Philippines from the COVID-19 pandemic.
The investment banking firm said the Marcos campaign had signaled broad continuity with current administration policies, such as the “Build, Build, Build” infrastructure program and the “war on drugs” while maintaining a friendly stance toward China.
Goldman Sachs’ Asia team based in Singapore noted that the next administration needs to make clear policy choices, including prudent fiscal improvement amid rising public debt, external financing constraints, and adverse impacts of global price shocks.
“Marcos has sounded a less cautionary note on rising public debt levels, while emphasizing measures such as subsidizing key agricultural inputs or capping key food prices to contain inflation risks, alongside initiatives to revitalize the industrial sector and SMEs to provide more jobs,” it said.
On the other hand, the group said, “Robredo has outlined a comprehensive plan to take the Philippines forward from the COVID crisis, with a ‘Jobs for All’ strategy that includes reducing corruption, cutting red tape, supporting SMEs, widening unemployment insurance and reviving the manufacturing sector, while improving educational outcomes.”
A Robredo presidency, it added, could mean a tougher stance on China over territorial disputes, a stop to the Duterte approach against illegal drugs, and “greater emphasis on building more socially impactful infrastructure.”
What’s interesting is that GoldmanSachs cited results of a Bloomberg survey of investors and analysts, released last March, that suggested that Robredo was the top pick to become the next president:
“Investors polled appear more ‘lukewarm’ to the prospect of a Marcos presidency, perhaps reflecting views on the family’s previous period in power.”
We eagerly await the outcome of the elections on Monday with the hope that the next president will exert all efforts at reducing poverty levels and ensuring a better quality of life for Filipinos, especially those living on the margins of society. Needless to say, that will also mean mounting an honest-to-goodness anti-corruption campaign at both the national and local levels to see to it that taxpayers’ money will all go to vital infrastructure and essential social services, and not into the pockets of the greedy and the unscrupulous.
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