He high record of the Philip­pine econ­omy at the end of 2016 has not quite changed the low con­fi­dence in­dex clocked around the same pe­riod. To make some sense of the sit­u­a­tion as w ell as draw a clearer pic­ture of 2017, the in­vited Ge­orge Barcelon, pre­side

Philippine Tatler - - AMS 2016 -

Doris Magsaysay Ho is pas­sion­ate about the ben­e­fits of eco­nomic clus­ter­ing KAREN DAVILA: We’re clos­ing the year with es­sen­tially good num­bers at 7.1 per cent growth and de­spite what’s in the news, the con­cerns of West­ern me­dia, many say that no one can stop the growth in the re­gion. In this con­text, how would you de­scribe 2017? GE­ORGE BARCELON: With our eco­nomic fun­da­men­tals, and the fact that there’s a lot of PPPs [pub­lic-pri­vate part­ner­ships], growth will def­i­nitely be there. The man­u­fac­tur­ing sec­tor is gear­ing up; the gov­ern­ment is fo­cus­ing on the agri­cul­ture sec­tor. If done well, these could eas­ily move up our growth by a per­cent­age or so. Bud­get Sec­re­tary Ben Dio­kno has said he ex­pects growth to be at 10 per cent by the end of Pres­i­dent Duterte’s term. With what we see on the plate now, 8 per cent is def­i­nitely achiev­able. Add tourism, and we can see even a higher growth. KD: So you be­lieve this ad­min­is­tra­tion is on the right track so far? DORIS HO: We have a great op­por­tu­nity to build on the gov­ern­ment’s so­cio-eco­nomic agenda with a clear strat­egy on which sec­tors of agri­cul­ture, man­u­fac­tur­ing, and ser­vices give us a unique com­pet­i­tive ad­van­tage. Since the gov­ern­ment is push­ing for growth through­out the coun­try, the strat­egy should iden­tify re­gional pro­duc­tion clus­ters around hub ports so we have economies of scale to lower cost of power, lo­gis­tics, and trans­port as well as of­fer SMEs [small and medium-sized en­ter­prises] the op­por­tu­nity to be part of sup­ply chains. We com­pete with economies that have clear ex­port tar­gets—Peru­vian av­o­cado, New Zealand dairy, Aus­tralian lamb chops. An ag­gres­sive and fo­cused strat­egy em­braced by busi­ness, gov­ern­ment, civil so­ci­ety, and the labour force, I feel, would be the great­est con­trib­u­tor to sus­tain­able growth. AA: In terms of in­clu­sion, the im­por­tance of agri­cul­ture is that even though it only ac­counts for 10 per cent of GDP, it in­volves about 30 per cent of the work­force. KD: What would be the prac­ti­cal way to im­prove the num­bers of agri­cul­ture? The sec­tor was at a neg­a­tive growth in the past ad­min­is­tra­tion, wasn’t it? GB: The fail­ure of agri­cul­ture, I think, lies on the fact that we don’t have proper crop in­sur­ance. The farm­ers go broke ev­ery time the weather de­stroys their crops. We need to put a sys­tem in place where banks can give loans to the farm­ers be­cause they’re in­sured. And here we don’t have

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