Saturday, November 26, 2011

President Aquino's anti-corruption campaign may be distracting him from economic growth challenges

The core of Philippine President Benigno "Noynoy" Aquino III (PNoy) continues to resonate among his fans today -- Kung walang kurap, walang mahirap. ("No corruption means no poverty"). That is the President's hypothetical solution to reducing poverty in the Philippines.

But has this hypothesis stood up to the empirical evidence so far observed?

It's a bit iffy according to Wallace Business Forum consultancy president Peter Wallace...
The drive to root out corruption has led to much lower-than-expected government spending and delays in putting infrastructure projects out for tender as deals are reviewed and the government sets to build watertight contracts.

Wallace said had spending been as planned in the first half of the year, annual growth would have been 6.3 percent - more than 50 percent stronger than actual growth of 4 percent.

The payoff of hitting graft would be a cleaner and more open system in future, which should lead to better growth and more investment, but that is not a guaranteed outcome.

"He's moving more or less in the right direction, he's just got to move more quickly," said Wallace.

This apparently leads the Reuters author of the article from which the above excerpt was taken to title his piece "Is PNoy's anti-corruption campaign distracting from the economy he wants to save?"

What should be examined in the coming months is the question around the nature of the causal relationship between corruption and poverty. Does corruption, indeed, play that big a factor in the continued impoverishment of the Philippines?

2 comments:

  1. Campaign against corruption is in the right direction but selective application of the campaign will not led to a successful positive economic progress but will only divide the nation.

    ReplyDelete
  2. @Anonymous-You are quite right. It seems his policy is only for the selected few, that if you are not a "asskisser" sorry ka na lang.

    ReplyDelete

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