Cartoon By: Aaron Paul C. Caril
EDITORIAL
Middle-class status: A cover-up for development sins
The present administration is aiming to elevate the Philippine economic status to an upper middle-class country by 2025.The goal was announced by the Marcos administration when the World Bank benchmark was still at $4,466 to $13,845 gross national income (GNI) per capita. But the World Bank has raised the benchmark to $4,516 to $14,005. Has the upper middle-class status become an impossible dream for the Philippines?
The Philippines has consistently remained as a lower middle-income country in 2022 and 2023 with a GNI per capita of $3,950 in 2022 and $4,230 in 2023. Under the old benchmark, we would have been just a stone’s throw away from the goal.
An economics professor from a leading university said that the Philippines can still become an upper middle-income country if it grows by 6-6.5% every year for the next two to three years. Economic managers target a 6-7% GDP growth this year.
The Philippines wanted to join the ranks of Indonesia, Malaysia and Thailand which are already classified as upper middle-income countries. At present, the country stands on the same footing with Cambodia, Laos, Myanmar and Vietnam.
According to IBON Foundation Executive Director Jose Enrique A. Africa, the economic status that the present administration is aspiring for is just a number but there are strong reasons to doubt if the Philippines will achieve even that in 2025. He noted that there is generally an economic slowdown that started in 2017 and was momentarily camouflaged by the pandemic lockdowns, contraction, and rebound.
With the economic status at severely low levels during the pandemic, the post-pandemic statistics apparently looks good as economic activities return to normal.
Reaching the goal as an upper middle-income economy, however, does not guarantee that the situation of the middle class, poor, and poorest of the poor families will improve as we are still struggling with the wide gap between the rich and the poor.
Overall, the Philippines may reach the status, may be not in 2025 but perhaps in a few years’ time. This does not guarantee the elimination of chronic poverty for the poorest, bloating disguised joblessness or worsening inequity have been resolved. The upper-middle income status may even exacerbate the sufferings of the vulnerable sectors as the country’s growing economy continues to be dominated by a few elite families.