THE think tanks of President Rodrigo Duterte’s administration calls its ambitious economic program, Dutertenomics, the backbone of which is the proposed P8.2 trillion spending on infrastructure for the duration of the President’s tenure. Government economic planners claim such huge amount would be sourced from taxes, the collection of which they hope would go up once proposed tax reforms are in place.
If you have been listening to government planners the past months, you should have heard of the “big-ticket” (actually mind-boggling) infra projects they are promising to build. A bridge connecting Cebu and Bohol provinces here, and coastal and other major road projects in Cebu there. And that’s only for Central Visayas. The massive-ness of those projects actually had me thinking if these can even be realized.
We are not talking here of “mere” billions of pesos in government spending. We are talking of trillions of pesos (12 zeroes). More than that, we are not talking of money given by charity but money from government coffers. And to say that government’s annual revenues are enough to sustain these is too good to be true. More likely a big chunk of the money would be sourced from the loan China promised.
It’s not that we haven’t followed this path before. Fans of the dictatorship of former president Ferdinand Marcos are fond of pointing to the major infrastructure and other projects implemented during the dictator’s two-decade rule. What isn’t always mentioned is how deeply Marcos’s programs placed the country in indebtedness. The issue that time was that future generations would be burdened by the debt.
That is why it is good to scrutinize Dutertenomics this early before it is too late. Anders Corr, founder of Corr analytics, recently came up with such scrutiny in a contributed article to Forbes magazine. GMA News Online published a report on Corr’s analysis yesterday titled: “Duterte’s P8.2 infra program may force PHL into ‘virtual debt bondage—analyst.”
“Dutertenomics, fueled by expensive loans from China, will put the Philippines into virtual debt bondage if allowed to proceed,” Corr said. He said the money that the Duterte administration will use would bring the country’s total national government debt to US $290 billion (P14.4 trillion). Consider how much of a burden was the around US $25 billion debt the Marcos dictatorship left to us in 1986.
The dictatorship’s loan tied us to the dictates of the institution that provided us the money, the World Bank (WB) and the International Monetary Fund (IMF). WB-IMF engineered policies that were more pro-capitalist than pro-people.
Imagine what would happen to us with the debt bondage chaining us to China—a country that has forcibly claimed a chunk of our territory in the West Philippine Sea. And how much of the money would go to the corrupt in the government?
I would be lying if I would say that I am not intrigued by “Dutertenomics,” especially of what is in store for Cebu in it. But in this case, I have my worries.
r