‘Cha-cha’ proponents should think twice before opening up ‘insecure’ PHL economy

PHILIPPINE STAR/ MICHAEL VARCAS

By Kyle Aristophere T. Atienza, Reporter

POLICY MAKERS must ensure that the country’s institutions and vulnerable communities are capacitated and equipped to deal with economic liberalization measures before passing the so-called “economic” Charter change (Cha-cha), analysts said.

Jayvy R. Gamboa, a lecturer at the Ateneo De Manila University’s (ADMU) Department of Economics, said legislators must consider the socioeconomic and health insecurities of Filipinos before “further opening an already insecure country.”

“We cannot look at the proposed economic Cha-cha in a vacuum,” he said in an e-mail. “Such a proposal cannot be interpreted without looking at the context in which Filipinos are currently situated: one that is gravely dependent and unfortunately still centered on health concerns or insecurities.”

The House Committee on Constitutional Amendments last month approved a resolution seeking to amend certain economic provisions of the 1987 Constitution. This involves easing restrictions on foreign ownership of public utilities, mass media, educational institutions, among others.

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Mr. Gamboa said policy makers may use the emerging “human security” approach in evaluating the impact of lifting foreign restrictions.

In 2012, the United Nations General Assembly adopted a resolution calling for a governance that is based on “human security” to pursue the 2030 Agenda for Sustainable Development. It sought to address the root causes of socioeconomic insecurities, noting that solutions must be “people-centered, comprehensive, context-specific, and prevention-oriented.”

The approach seeks “to create inclusive and resilient societies that directly address the wide range of interconnected and mutually reinforcing vulnerabilities or insecurities.”

“This paradigm does not call for ‘band-aid’ solutions on a minute problem, without due consideration on the other factors tied to it. If we will proceed with the latter, the country is bound to face unintended consequences that our policy makers did not even consider at the beginning,” Mr. Gamboa said.

Institutional problems that emerged during the pandemic must be addressed in order to maximize the economic potential of any move amending the economic provisions in the 50-year-old Constitution, Mr. Gamboa said.

“Without a labor force that is confident of their own and their families’ health and of the healthcare available to them, businesses will continue to be unstable,” he added.

“The fears of those who are critical of the economic Cha-cha at this point will come true. Filipinos will become the losers in this game, which we ourselves have set up.”

MORE DISCUSSIONS NEEDED
More discussion on the impact of economic Cha-cha at the community level is needed, ADMU Policy Center research fellow Michael Henry Ll. Yusingco said in a Facebook messenger chat.

“The concerns of sectors that will be affected, such as educational institutions, regional media outlets, indigenous peoples in mining areas, need to be heard and considered,” Mr. Yusingco said. “A strong and concerted protest mobilization from any of these groups can scuttle economic Cha-cha altogether.”

Mr. Yusingco said there should be a mechanism to allow the public to submit proposals for economic Cha-cha.

Using the context-specific approach in the human security paradigm, Mr. Yusingco said it is difficult to see how economic Cha-cha can help the economy’s post-pandemic recovery.

“Moreover, economic Cha-cha is likewise not necessary in other potential recovery strategies such as comprehensive digitalization, revamping the manufacturing sector, ramping up domestic food production, and expansion of ecozones,” he added.

Lawmakers should consider the suggestion of many economists to focus on health sector reforms as the main cog of a national recovery plan. They should also take note of the absence of a clear regulatory approach to balance national security and foreign investment liberalization, Mr. Yusingco said.

“Foreign interference in social and political affairs is a very serious matter. Obviously, our government must be equipped in dealing with this problem,” he said.

Terry L. Ridon, convenor of infrastructure advocacy InfraWatchPH, said the current push for Charter change does not address the root causes of socioeconomic insecurities, such as job loss and insecurity, healthcare access and delivery, education access, among others.

“With a massive number of new cases due to new variants spreading across the nation, the focus of the government should be how to continue finding the balance between economic easing and implementing health and safety protocols, and undertaking mass vaccination,” he said in an e-mail.

“We cannot be distracted with noise coming from quarters seeking to toy with the Constitution at this time.”

Mr. Ridon said the country would be able to reach its previous levels of economic growth without easing the foreign equity restrictions because the “country achieved unprecedented GDP (gross domestic product) growth in the last 20 years” despite equity restrictions in protected industries.

“A large percentage of GDP consists of sectors that are not within equity restrictions, such as outsourcing, semiconductor manufacturing, tourism, finance and other exports,” he said.

Mr. Gamboa, meanwhile, said lawmakers should also ensure that the local businesses, especially micro, small, and medium enterprises, would be able to compete with new entrants.

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