I had the opportunity to present the global and national outlook for 2012 among the students of the University of the Philippines-Visayas taking up economics in an activity dubbed as “Vision 20/20 Philippines: Where Iloilo or the Philippines will be on the next decade”.
The UPV Oeconomicus used “Vision 20/20” as a metaphor to envision if economic development has a clear path for this decade and which will culminate on the year 2020.
Among the resource persons in the event were Dr. Rodelio Subade, Mark Valino and fellow columnist of this paper and widely recognized local broadcaster Gerthrode Charlotte Tan-Mabilog. They gave a talk on the environment of Iloilo City, the financial market in the next decade and the role of mass media in the economic development of Iloilo City in the next decade, respectively.
The 2012 economic situation is not promising as pointed out by the analyses of various economic and media institutions. I utilized the material of the United Nations, particularly the Department of Economic and Social Affairs (UN-DESA) which was encapsulated in the book, “World Economic Situation and Prospects 2012”. The Guardian, a more progressive paper based in the United Kingdom likewise tackled a similar topic covering the economic outlook of 2012 in an article entitled “The global economic outlook for 2012 isn’t pretty”.
The global economy isn’t pretty for the reason that the “Eurozone recession is certain, the United Kingdom is double-dipping and the United States is growing at a snail’s pace. “Fasten your seatbelts, it’s going to be a bumpy year”, said the Guardian. The crisis reality is not just unfolding in the North; it is very much unfolding in the Philippines, and within the country. The “isn’t pretty” scenario describes Iloilo City’s economy considering the skyrocketing cost of electricity alone. Not to mention the exodus of overseas Filipino workers who are affected by the unrest and the little chance of them acquiring employment in the Philippines.
My own presentation revealed that the economy of this decade will be unstable and the year 2012 will play a significant role in determining what can be achieved by the economies of the world on the road to year 2020. It likewise illustrated the stumbling blocks.
I used as reference the material shared by Lidy Nacpil, one of the vice-presidents of the Freedom from Debt Coalition, in a recent discussion about the global economic situation. The materials of UN-DESA and the Guardian were used not necessarily to reach an agreement but to stir discussion and debate.
In very broad strokes, UN-DESA’s analyses revealed that the world economy is “on the brink of major economic breakdown which kicked-off in mid-2011 and is expected to continue to 2012 and 2013. Economic growth will decelerate as a result of ‘‘persistent high unemployment, low wage growth, prolonged depressed housing prices and foreclosures in the United States”.
Another factor that will affect global economy is the slowing down of economic activity in the Eurozone area as a result of debt crises while on the over-all, the “failure of policy-makers in developed countries to address unemployment and prevent sovereign debt distress continues to pose acute risk for the global economy.”
The Guardian’s economic team highlighted that Europe will again plunge in a second wave of recession, or “double-dipping” while United States will contend with an anemic growth and China will undergo a sharp slowdown as a result of low prices of commodities and low commodity demand. Another factor is the high oil prices as an outcome of the turmoil in the Middle East.
I singled out the volatility of oil prices for it will largely affect the Philippine economy. Such will greatly affect not only taxpayers, but consumers of goods and consumers of electricity; especially that many generating facilities in the country, like coal-fired power plants that are dependent on oil.
I have yet to imagine how the Philippine economy will achieve stability amid a global economic slowdown. The absence of a clear path to economic development under the Aquino administration puts the country further in uncertainty.
Economic stability is even less promising for Iloilo City. The nearest development activity that the Mabilog administration can brag about is the construction of the New Iloilo City Hall and the aggressive projects of Injap Sia with all his infrastructures here and there yet without the demand that will guarantee economic stability. So far, things are artificially moving for Iloilo City.
It remains vague how the local economy will become stable in light of global trends. It also remains unimaginable how the local economy can address the growing demand for resources in light of the catastrophes and impacts of climate change to the people.*