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Education, governance and growth in 2014

The Philippine nation weathered on powerfully through a stormy 2013, battered as it was with the many threats to national security from the South, tightening international tension and militarization over hotly contested waters, May elections, the abolition of discretionary funds in the legislature, high-profile prosecutions and resignations in government, a sudden plummeting of the stock market, and the worst storm to batter the central part of the country in years.

What can the country expect this coming year? The LaSallian takes a look at some key national issues that the community should follow up on for the rest of 2014: education, governance and economic growth.

 

Education: Fundamental issues first

For 2014, the biggest chunk of the Php 2.268 trillion national budget has been appropriated for education, with most of the cut being appropriated for K-12 related activities. The amount of Php 281.75 billion pesos allotted exclusively for the Department of Education (DepEd) is going to be carefully spent for the move, which is intended to set the Philippine basic educational system at par with other nations.

Where the country’s four big universities have already confirmed plans to eventually align their academic calendars with surrounding regions given the looming integration of ASEAN into a single economic community by 2015, not all educational institutions have been open to the idea of just simply changing their own academic calendars, specifically the DepEd.

DepEd Secretary Br. Armin Luistro, FSC told Interaksyon last January 7 that the next school year will start in June and that there is as of yet no reason for students at the basic level to worry about shifting in the academic calendar. “There is no compelling reason to push for the change, although the Department of Education is not closed to the idea.” He added that there are more pressing concerns, such as constructing more classrooms, hiring more teachers, reviewing curricula in science and math and providing more learning aids and educational equipment.

The country can look forward to a consensus between higher education and basic education within the year, before the Philippines formally integrates with the rest of ASEAN in light of other pressing, fundamental issues in the educational sector.

 

Governance: Better checks, less corruption

2013 saw, among many other anomalies in governance, the biggest scandal of the national legislature to rock public sensibilities – the revealed workings of corruption in the allocation of the Priority Development Assistance Fund (PDAF), with JLN Corp. and its owner, Janet Lim-Napoles and family, as the villains of the drama. Approximately Php 25.20 billion was appropriated for the discretionary fund last year, with legislators funneling the cash through ill-checked disbursements and coursed through national agencies and bogus non-governmental organizations.

The President, however, has announced that the General Appropriations Act for 2014 will cut the bureaucracy in distributing funds to national agencies and line departments, as the national budget now suffices as a special release form for the agencies to which funds are allotted, greatly speeding up the process of disbursement and leaving fewer avenues for potential corruption and anomalous transactions.

The GAA-As-Release Document system, as it is called, is no surefire guard against other forms of irregular activities in the approval of cash requests, though, and state pundits have affirmed that while the abolition of the PDAF for 2013 may have been declared by the Supreme Court and the President, there are other means by which lawmakers can take advantage of public money in anomalous transactions. This includes lump sum funds and special appropriations in the national budget, which account for 10 percent of the national budget at Php 229.53 billion pesos.

The public is advised to remain vigilant in the aftermath of the PDAF scandal and sustain the concerted efforts of stakeholders to repel corruption in the national and local government.

 

Economy 2014: The tiger still roars

For the past year, economic growth spurred rapidly, with the international community branding the country as possibly the fastest growing economy in Southeast Asia. According to an Inquirer article dated last June 2013, the National Statistical Coordination Board (NSCB) reported that the country’s gross domestic product (GDP) grew by 7.8 percent in the first quarter, highest among China, Indonesia, Thailand and Vietnam. During the second quarter, it posted a 7.5 percent GDP growth while 7 percent during the third quarter. The main actor behind this achievement is the industrial sector – mining, construction and manufacturing. In 2016, the Secretary of the National Economic Development Authority (NEDA) Arsenio Balisacan expects the country to enjoy 7 to 8 percent growth.

This surge of economic growth can be expected this 2014 even with the devastating aftermath of typhoon Yolanda, according to Dr. Gilberto Llanto, President of the Philippine Institute for Development Studies (PIDS). He explains that the economy will still register strong growth, with the downside being an active inflation rate, caused by the disruption in supply chains and other food producing areas. “Overall, we hope that 2014 will have, I think, still strong growth – maybe even 7 percent is possible.”

Strong reforms on governance and policy reforms in several areas, including the dissolution of discretionary funds for 2013, and the macroeconomic stability in others contribute to the expectation of continued strong growth performance. “We also have to note the very strong, stronger fiscal position of the government,” Llanto added. However, he still believes that it largely depends on external events that may raise some negative impacts. Higher rates of interest are also expected. Llanto describes that according to BSP, “there is a policy process to tighten a bit of the monetary side because inflation rate, which is expected to be at 4 to 5 percent.”

When asked about where the growth will come from, Llanto confirms that the services sector, especially the business process outsourcing (BPOs) and other services, such as real estate and trade financing, will be strong sources. Service continues to create jobs, in addition to a good number of Filipino professionals.

He also adds that there are positive signs in the manufacturing sector. “I think the thing that we should watch out for most especially is food manufacturing.”

Government spending will also contribute to the growth through infrastructure development, as pointed out by Llanto, because of post-Yolanda efforts, construction and rehabilitation. “When the government so to speak gets its act together, rehabilitating and rebuilding the devastated areas, that will be a source of growth,” Llanto claims. He also mentions that the big ticket items are the larger infrastructural projects, of which are the NAIA Expressway, the final stages of NLEX-Rosario La Union, Cebu-Mactan Airport, and the LRT in Manila in terms of planned infrastructure developments. There is also the growth of OFW remittances which translates to higher consumer demand, as a good source of growth, inuring primarily to the money that came in following typhoon Yolanda.

By Nina dela Cruz

By Juan Batalla

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