Expanding the horizon – Tuesday, 18 October 2016
As President Rodrigo “Digong” Duterte leaves for China today, he brings with him our hope the country’s economic potential could be harnessed to near-full capacity as what our neighboring countries have achieved in the last four decades.
While many would be quick to jump the gun and declare this as near-to-impossible, relegating this to mere wishful thinking, this writer is inclined to believe it was more of the mismanagement of the country’s economy over the years which made the Philippines lose its Rising Economic Tiger status in the 80s as it missed the bus in the then period of economic transition as industries shifted to Asia that spurred the growth of China, South Korea, Taiwan, followed by Malaysia and then Thailand.
Instead of expanding its economic horizon, the Philippines had to content itself with its partnership with neighboring countries in Southeast Asia and its principal global partner, the United States. It failed to open up trade partnership with then Asia’s fast rising economy — China, which now happens to be the world’s biggest.
A paper released by the Philippines-Asia Institute for Strategic Studies cites the mounting calls for Duterte to focus his efforts toward forging the New Philippine-China Special Relations to ensure a firm partnership with China for the Philippines’ economic development.
With support from China’s massive financing and investment capacity for assisting the Philippines’ physical and transport infrastructure development, PAISS avers tourism promotion, fisheries and agricultural cooperation could experience a boom.
To substantiate its claims, PAISS cites the Vietnamese experience.
Last Sept. 15, 2016 after just four months in office the new Vietnamese Prime Minister Nguyen Xuan Phuc completed his six-day official visit to China, the first trip to the country by a senior State and Party leader after the 12th Natonal Party Congress in the past January.
According to PAISS, the visit of Vietnam’s top leader at this very early stage signals that country’s recognition of the urgency of mending its ties and improving its bilateral relations the new global economic leader as established at the much acclaimed Hangzhou G20 meeting, and it is not waiting around for other Asean countries to beat it to starting line.
Vietnam and other Asean countries which maintain economic relations with China, has benefited a lot compared to our country whose main economic partner is the US.
Consider the following situation of the Philippines vis-à-vis economic relations with China compared to Asean and other countries: Overseas direct investment (in Million USD) in 2015 from China to — Vietnam, 323; Indonesia, 1,328; Myanmar, 206; Cambodia, 392; Laos, 1,357; Malaysia, 408; Singapore, 4,963; Thailand, 443; Philippines, 24.
Tourism should be another area of serious interest for the Philippines: China’s outbound Tourism to Asean (in Thousands of persons) in 2015 — Vietnam, 1,781; Thailand, 7,934; Malaysia, 1,677; Indonesia, 1,430; Laso, 510; Cambodia, 800; Myanmar, 148; Philippines, 491. The Philippines should at least aim to quadruple tourist arrival from China in the shortest time possible. The only way to fast track these economic potentials is fast tracking our enhanced fraternal relations with China.
According to PAISS, countries all over the world are prospering with China, tapping into its market, availing of its financial and technical assistance and construction technology and capabilities. Below is a brief listing of cooperation and projects redounding to the benefit of all parties engaged with China:
Tourism, which the Philippines must put priority in as it is has the greatest income earning potential with the least capital cost.
Thailand eyes 10 million Chinese tourists in 2016 from 8 million in 2015 that generated over USD 10.3-billion. Malaysia approved visa-waiver for Chinese tourists in the hopes of increasing Chinese tourists to 8 million.
Updated figures show 47 percent increase of 1st half 2016 Chinese tourist arrivals to Vietnam to 1.2-million, while the Philippines had a whopping 101 percent increase in the first five months of 2016 to only 300,000 Chinese tourist arrival which was already the biggest among all incoming Chinese tourists increases to Asea — room for a great deal more to come.
Agricultural/Fisheries Cooperation. Vietnam and China currently enjoy the benefits of the Fisheries Agreement in the Gulf of Tonkin with joint efforts for sustainable fisheries. From 2014 to 2015 Chinese businesses invested in 133 agricultural projects in wood, animal feed, seafood, vegetable and fruits processing amounting to USD 300-million.
In Africa, Cote d’Ivoire “one village-one company” project to increase income for farmers will be carried out by China in 100 villages, while the Guiguidou hydro-agricultural project will enhance rice farming for 400 hectares of rice land. In Uganda China rice technology is helping local farmers increase yield by three times through better breeds and modernization.
In Namibia a Chinese-built inland aquaculture center was turned over to the government to support the enhancement of the African country’s inland fisheries development.
From these example of agreements and joint efforts between Vietnam and China, and Chinese assistance in agriculture and fisheries in developing countries the Philippines can pick up many lessons and learn the benefits of “win-win” cooperation with China which we Filipinos cannot delay anymore.
Industry. China is engaged with Asean in many facets of industrialization, and again Vietnam is at the forefront of cooperation with China with the Vinh Tan 1 thermal 1,200MW USD 1.7-billion power project capitalized by two Chinese companies. Industrial parks and special economic zones are being set up such as the Indoneisan Morowali Tsingshan Industrial Park, Cambodia’s Sihanoukville Special Economic Zone, Malaysia-China Kuautan Industril Park, the Thai Chinese Rayong Industrial Zone, Myanmar’s Tagaung Taung Nickel Mine and Laos’ Saysettha Development Zone.
With regard to trains and railways, PAISS avers that China now has the most advanced train and railway technology due its experience in building the World’s longest HSR (High Speed Rail) system (20,000 km.) under technology transfer agreements with foreign train-makers such as Alstom, Siemens, Bombardier and Kawasaki Heavy Industries and then re-designed internal train components to be even better. Coupled with the surplus train and railway construction experience accumulated in building the World’s longest HSR system, and with the financing capabilities it is now unbeatable in quality, cost of production and construction.
As such, PAISS strongly urges Duterte, to proceed without delay, his dream of building the light, fast, high speed, passenger and cargo trains he has envisioned for the country and tis many metropolises. And that could realized by opening up and expanding the country’s economic horizon.
Years of being too dependent on only one partner has only proven to be detrimental to country’s progress. Hence the need to expand and not limit our potential.