Efren Ll. Cruz, author of the book “Pwede Na! The Complete Guide to Personal Finance,” sent an email that has an attachment of an Excel file prepared by ATR Kim Eng Securities, Inc. It is a chart tabulating various economic indicators from the Marcos regime (1980) up to the current Arroyo administration (as of 2004).
Mr. Cruz highlighted which indicators reflected the best (in green) and worst (in red) average performance during each regime.
Noel Gamo, another member of the group, cared to explain the headings in detail:
GDP Growth – Gross Domestic Product or GDP is the amount of goods and services produced within the geographic boundaries of a country and is therefore a measure of economic activity in that country. Gross National Product or GNP, on the other hand, is the amount of goods and services produced by the citizens of a country (and thus includes remittances from OFWs). GDP growth measures the increase/decrease in the amount of goods and services produced from one period to another in real terms (i.e. excluding inflation). Higher figures are obviously better.
91-day T-Bill Rates – The figures in this column are the weighted average interest rates (WAIR) of 91-day Treasury Bills sold (by the Bureau of Treasury) in auctions during the year. While higher T-bill rates are good for investors, we should also remember that they serve as benchmarks for short-term lending rates for banks and other lending institutions. Hence high interest rates are not good for the economy in general as they raise the costs of doing business.
Inflation – The increase in the cost of living.
NG Budget Balance as % of GDP – A positive National Government (NG) Budget Balance means there is a budget surplus (more revenues than expenditures) while a negative figure means there is a budget deficit. To cover the deficit, the NG has to borrow money, domestically (through issuance of more Tbills and Tnotes) or internationally (by borrowing from multilateral banks or by issuing bonds). So a high negative figure is bad.
External Debt as % of GDP – This is the government’s foreign borrowing as a percentage of GDP. Obviously, the lower the figure the better.
GIR in months worth of international reserves – The actual level of Gross International Reserves (GIR) is a measure in dollar equivalent of the available foreign exchange resources to meet essential import requirements. The GIR in terms of equivalent months of imports shows how many months of importation can be covered by the current level of reserves. It is computed as the ratio of GIR to the average imports of goods and services for the immediately preceding 12 months. Higher figures are definitely better.
Both Mr. Cruz and I profess that we’re not fans of GMA, but apart from a high budget deficit, her administration produced the best averages, apart from FVR’s and Erap’s achievements.
So did GMA’s economic reform policies do good to the economy? The answer appears to be a clear yes.
But then on afterthought, the real answer is not necessarily, because we’re probably only recently benefitting to economic reforms made during the Aquino and Ramos regimes, economic gains that would’ve come earlier if not for the Asian Economic Crisis of 1997.
Did she have to “steal the presidency not once but twice” to be able to do it? I still prefer to leave that to an impeachment proceeding.
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Sidenote: Torn and Frayed in Manila has an interesting post regarding the debt status of the Philippines, and how it affects our country, and ultimately, our lives. Do check his post out.
11 responses so far ↓
1 bugsybee // Jul 22, 2005 at 6:33 pm
Hi Jon,
I’m not an economist so I’m not really interested in getting into the nitty-gritty of the economic statistics. For me it’s enough that they say that the economy has improved, blah-blah-blah. My problem is why do these people keep on saying that - and they have statistics to boot - and all the people at the other end of the line are complaining that they’re having more difficulties making ends meet these days. I can see that it’s true. So which is which?
2 Jon Limjap // Jul 22, 2005 at 9:52 pm
The statement “it’s more difficult to make ends meet these days” actually means two things.
First, the cost of living is truly more expensive. I’ve seen a graph somewhere (sorry I can’t remember where) that shows that the buying power of currency really depreciates over time, even in the richest cities in the world, because inflation outpaces income levels. Salaries only increase by the time prices are already so much that a substatnial increase in salary still appears marginal. That’s a universal fact and it’s more difficult for countries like the Philippines who have experienced successive double-digit inflation rates for nearly a decade before anybody was able to do anything to slow it down.
However, the second thing to consider is that the *standard* of living also increased. Ten years ago, the masa did not have cellular phones. Today, cellphone load is part of the “daily basket of commodities,” not to mention the occasional loan they have to take out to upgrade to the latest model. Back then, having a refrigerator meant your electricity bills went up. Today, the aircon and that home entertainment system jacks up your electric bills too. Back then, canned fish meant 555 or Ligo sardines. Today, canned fish means Century Tuna. Back then, children were happy with red hotdog. Today, they want chicken nuggets and cordon bleu in the menu as well. Back then, small Japanese and European cars were the norm. Today, gas-guzzling SUVs are the kings of the road. Back then, public transportation meant riding a jeepney for even the farthest destinations. Today, people prefer to ride airconditioned FX taxis that charged (or at least used to charge) twice as much.
So you have a higher cost of living, coupled with a higher standard of living. Put two and two together, and you’ve got yourself the financial hell-hole (more like quicksand) for the common tao.
3 bugsybee // Jul 25, 2005 at 4:16 pm
Thanks, Jon. That was a very helpful explanation indeed. Our problem is to let the common tao understand and that would be like climbing an endless series of mountains. There will be no explanation acceptable to a man who can’t eat three full meals a day or to one who has lost hope of finding a decent job. That’s why they’re more ready to blame Gloria for all their woes and it doesn’t help that some politicians take advantage of this helplessness and hopelessness to fan the flame. I feel sorry for our country.
4 Jon Limjap // Jul 25, 2005 at 6:52 pm
Well, I always believed that one’s destiny is shaped by no other person but him or herself. I’ve seen a lot of people who rose from poverty, quite a few are close, and their common denominator is their ability to find opportunities where most other people would despair about “not having any hope.”
I don’t feel sorry for our country, I feel sorry for everyone out there who aren’t mature and educated enough to shape their own destiny.
And yes, that includes the middle and upper class guys who always feel hopeless.
5 Trosp // Jul 25, 2005 at 11:30 pm
Hi Jon,
“I don’t feel sorry for our country, I feel sorry for everyone out there who aren’t mature and educated enough to shape their own destiny.”
The same sentiment that I have if I have interpreted it correctly. Ang problema, karamihan sa atin, kinukunsinti natin yung mga marginals. Instead of encouraging them to rise up, ang ginagawa natin, tayo ang bumababa sa level nila. That’s why, marami tayong nakikitang mga nakakaangat na parating sinasabi (through media) “kawawa naman sila, magdonate tayo”.
“Or huwag hulihin ang mga colorum na jeepneys, walang kakainin ang mga drivers na mawawalan ng trabaho. Or huwag paalisin ang mga illegal sidewalk vendors…” (The worst I heard from a forum in a TV - “Abu Sayyaf and Muslim kidnapers exist because they don’t have money to buy food”.) It goes on and on.
6 Jon Limjap // Jul 26, 2005 at 8:56 am
Another of the more preposterous versions of your last statement is one that propped up at the time of the Mike Arroyo jueteng inquiries:
“Kawawa naman yung mga kabo at mga kubrador. Kapag nawala yung jueteng, mawawalan sila ng trabaho…”
It’s just like saying:
“Kawawa naman yung mga mamamatay tao. Kapag hinuli mo sila, walang kakainin pamilya nila…”
“Kawawa naman yung mga magnanakaw. Kapag hinuli mo sila, hindi na sila makakapaguwi ng pera sa pamilya nila…”
“Kawawa naman yung snatcher. Kapag hinuli mo sila, hindi na sila makakabili ng pang-load ng cellphone…”
The list goes on and on indeed.
7 bugsybee // Jul 26, 2005 at 7:07 pm
Jon, you know I taught for 20 years. Some of my students were so poor they grimaced when I asked them to photocopy a page - 50 centavos. But they struggled. Some succeeded only because we were able to look for financial help. But there’s such a thing as donor-fatigue so some were never able to make it. 5, 10 years have passed and they’ve not taken the board exams because it’s too late to catch up with the changes. Those lucky enough to take the exams and pass it have distinctly better lives. Those who weren’t able to take it because we lacked the money (I helped them look for money but help was too scarce) went back to square one. Can we blame them if they get disappointed?
Ok, I used the wrong word - being hopeless is different from being discouraged. But my heart bleeds for my students. That’s why I feel sorry for our country that we keep fighting over stupid things when many are hungry, many are dying, many have lost the chance to have a good education.
Self-help is good but it doesn’t always work, believe me. There must be somebody willing to help you. Sadly, these people are getting fewer and fewer. If you say that there are still lots of people willing to do something, then send me the list because, frankly, my students need their help urgently!
8 Jon Limjap // Jul 26, 2005 at 8:54 pm
[b]bugsybee[/b]
Believe me, I understand where you’re coming from. My mother has been teaching for 31 years. I’ve met many of her students. In some cases I accompanied my mother to their homes. I’ve seen their plight, I understand your frustrations.
I do not mean to say that everyone who is poor do not know how to take advantage of their opportunities. Nor am I saying that everyone who is poor is immature. However I continue to be frustrated by the fact that I always see “poor” people spending their money in gambling and booze. It is frustrating that they profess being hungry while appearing to be obese. And then these are the loud ones who constantly complain about the government being so bad. Those are the people who I am talking about.
As for sources of funding, there’s this foundation that my mother always talks about. The founder is a math-trained businessman who went from rags to riches himself. I’ll ask my mother about it.
9 bugsybee // Jul 26, 2005 at 11:26 pm
Jon,
I see your point and I agree 100% with what you say. These are the kind of people - always complaining, doing nothing - who makes me want to shout, “I give up, kill me instead!” but when I see how hard my students try to improve their lives, that gives me hope, a reason to live (I’m single, no children).
I think that Metro Manilans who are successful should now try to go deeper into the provinces. Bacolod City is alright but the outlying towns and municipalities have bright but very poor students who have no chances of studying beyond highschool. If you take a look at the list of scholars, they’re the ones in better high schools in the cities. They’re the ones who badly need our help so they’ll not lose hope.
Thanks again - it rekindles the flame of hope within me when I meet young people who never lose hope
10 mitch // Jul 27, 2005 at 5:48 pm
business jargon! ack.
dumudugo ilong ko. hehehe!
11 Jon Limjap // Jul 28, 2005 at 6:55 am
mitch,
I used to think of it that way too… that economics is “nakakapandugo ng ilong” and I shouldn’t spend too much time trying to understand it.
But then one day I realized something. The business section of the newspaper is *where all the money talk is*. And where there’s money talk, there’s money.
Basa ako :p
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