Where goes the money?
It is almost a cliché to say that the Philippines consistently lags behind its ASEAN neighbors in attracting fixed long-term private foreign investments and ODAs (Official Development Assistance) to augment domestic capital formation.
Yet, the country, currently without fossil fuel deposits, iron ore, tin, rubber and other precious materials, with a 110 million population on shrinking arable lands and rainforests, produces conglomerates and tycoons that merit listing in Forbes’ wealthiest individuals in the world despite the fact that nearly half of the total population classify themselves either as “poor” as defined by poll surveys, or not enjoying a “comfortable” life as envisioned and promised by President Rodrigo Roa Duterte.
If statistics are to be believed, the Philippines is one of the fastest growing economies, with inflation below 2 percent; stable foreign exchange rate; GDP hovering around 6 percent; subdued militancy and stable political climate.
For these reasons, if the country is rich with abundant domestic capital and a surfeit of liquidity in the system, why are we begging for massive high interest and high-risk foreign investments that are slow in coming?
Where is the money going? Where is the money stashed away?
An informed and cursory observation will show that most businessmen are content with the status quo and wait and see and horizonal investments, such as buying existing companies, bank mergers, condominiums, subdivisions, and malls rather than technological breakthroughs, manufacturing and agricultural modernization.
Moreover, there appears a frenzy of floating long-term debenture bonds and commercial papers not aimed at research and manufacturing but to refinance or liquidate maturing debt.
That is, there is little real capital formation and innovation.
However, the more serious implication is the growing amount of investments in foreign countries more than the foreign investment coming into the
Philippines.
And is the money invested and hoarded abroad ever get repatriated or taxed by the government?
Thus, it is crucial and important for the authorities to monitor and supervise the monetary resources and wealth that are locally accumulated and amassed, and siphoned off to other countries.
This is a Filipino dilemma as he loses grip in his own country.
Concluding, President Duterte has been harsh and heavy handed on civil servants and the Philippine National Police but soft and tolerant of the unpatriotic activities of the private sector and errant entrepreneurs.
Bayan muna. Para sa bayan.
You be the judge.
“The public be damned. I’m working for my stockholders.” — William H. Vanderbilt