The existential threat and the legislative panacea
The Philippine economy showed good growth momentum in 2022 as it was able to withstand internal and external pressures from all angles. ADB’s forecast shows that the growth in the economy is expected to continue in 2023. Still, there are downside risks to growth, like inflation, increases in interest rates, and a sharper slowdown in GDP growth in advanced countries.At the end of the third quarter, the country’s debt ballooned to a new record high of P13.517 trillion. The debt-to-gross domestic product ratio rose to 63.7%, the highest since 2005, and well over the acceptable level of 60%.
Locally, farmers are having a hard time making ends meet as the prices of farm inputs have skyrocketed while harvests have suffered a sharp decline. Fishermen continue to suffer from dwindling fish catch, and consumers have to grapple with never-ending increases in the prices of essential commodities.
These are just some of the existential threats of the moment that the executive and legislative branches of the government should urgently address. One well-meaning economist has pointed out that it is the government’s job to set the economic fundamentals right, strengthen the economic recovery, and bring the fiscal deficit and the trade deficits under control as its first order of business.
But even without good housekeeping, Congress wants us to believe that the magic pill to our tribulation is the Maharlika Wealth Fund (MWF) that has breezed through the legislative mill in the House of Representatives. Now officially known as the Maharlika Investment Fund (MIF), its chance of becoming a law now lies in the hands of the Senate.
Singapore’s success may have inspired the President with its sovereign wealth funds. But great ideas from successful countries may turn out to be worst when implemented here because we lack the economic fundamentals. Thus, Congress should go back to what is the most important.