It was March 16, 2020 when Pres. Rodrigo Duterte declared Enhanced Community Quarantine in the entirety of Luzon. Restrictions were enforced left and right, with no one allowed out of their homes except for essential activities such as buying food or going to a hospital. In order to mitigate the effects of this event on the economy and the masses, the president signed the infamous Bayanihan Heal as One Act.
This Act enjoined government agencies such as the DSWD and local government units in order to provide dole-outs known as “Ayuda” to the constituents. It was meant to provide assistance to citizens heavily affected by the pandemic, however its lapses proved to be insufficient as citizens continued to struggle to pay for their utility bills and other expenses like food and medicine.
As of January 29, 2021, the National Economic Development Authority (NEDA) said that Philippine economy contracted by 9.5%. It signified that if the lockdown were to go on— more and more Filipinos would suffer from unemployment and consequently, starvation. This was exacerbated by the economic restrictions on FDIs.
According to Atty. Christian Monsod, restricting FDIs protect businesses of Filipinos from foreign depredation. For context, The only way for Foreigners to be able to set up investments in the Philippines was if they partner with a Filipino with the Filipino owning at least 60% of the capital. This paved the way for dummying: a practice that involved setting up “dummies” to meet legal requirements. This is considered illegal in many countries in the world, with the risks being taken by low trust countries like PRC or from businesses that are not hesitant to resort into shady practices. So despite the loftiness of his argument, reality presents a strong rebuttal.
The former Chief Justice Lourdes Sereno had also condemned constitutional reform using her faith in God to justify her stand. She viewed opposing it as her divine mandate. In her tirades against constitutional reforms, she created a strawman of what it actually was. One of the key figures in Filipino Evangelical Left who are against any type of systemic reforms, she presented constitutional reform as a way for Duterte to stay in power longer. She claimed that the Constitution is perfect and to alter it is a sacrilegious act, forgetting to render to Caesar belongs to Caesar and to God what belongs to Him.
It was not only the opposition that were against constitutional reform. Supporters of the Duterte Administration, Atty. Ahmed Pagkalinawan and his partner Atty. Trixie Angeles, were against constitutional reforms because it was deemed to open the floodgate of landgrabbers. They claimed that there were no FDI restrictions in the Philippines and that foreigners can invest directly for as long as the venture was not classified as a public utility, however the term “public utility” was vague. This term was the same term used to take down Uber, consequently allowing Grab to monopolize Philippine ride-sharing market. It was used to take down the consortium responsible for renovating Mactan International Airport. These people defended the policies that led to the unceremonious take down of the consortium. In addition, this sent a chilling message about the riskiness of investing in the Philippines.
Examining the Philippine economy, Chinese dominance in the country was caused by lack of competition. China, unlike western countries, demonstrates willingness to invest for as long as the client state would be willing to place a collateral. In this case, the collateral that China wanted were pieces of land or of territory just in case the client state defaulted or were unable to pay its debts. China invested in the Philippines through its vast corporations. Unlike in the Philippines, the government controlled a significant portion of Chinese corporations through the official party – the Communist Party of China or CPC in short. In China, if a person wished to establish a corporation, he or she should be affiliated with the party. Without this affiliation, it would be impossible to set up a shop. It was in this examination one can see that the fear of Chinese espionage and sabotage is not an unfounded fear; it was a real one, given the wolf warrior type of diplomacy China was employing.
According to Oswald Spengler, there were stages of a civilization that can be outlined into seasons: summer, spring, autumn and winter. Summer was the founding of a civilization and its core values. Spring was the peak of refinement while autumn refers to the crystallization of a civilization and winter refers to its destruction. Although Spengler was a conservative historian, his historical model still resonated with the rise of the Peoples Republic of China. From communism to a capitalist regime forged by a liberalized economy, PRC became a formidable economic force because of the reforms, gaining political sway over other countries, challenging even the United States of America’s hegemony over the Asia-Pacific region.
Given the restrictive nature of the Philippine Constitution, it is becoming more and more difficult for it to thrive. The 1987 constitution economically isolated the Philippines from the global market and progress with foreign entities, it manifested itself as a result of national paranoia towards anything that is foreign of the people at the time of its conception. In this modern era, talks of reforms which aim to alleviate this isolation is rejected, presumably from the concern that considering how previous constitutional reforms have fared to benefit the corrupt— there is a chance that this reform will be the same (much like the Marcos era). This reasoning however could be detrimental to the possible progress that constitutional reform may bring, because as much as there have been atrocities in the past— that doesn’t mean it will be the same the next time around.
Other than people rejecting this notion out of the concern that it could be manipulated to be the same as the past, it was also rejected by major stockholders of monopolies and duopolies. These major stockholders have invested a lot of money in these monopolies and duopolies. If foreign competitors were allowed to penetrate the Filipino market, the holdings of these major stockholders would lose value. This is why they would object to constitutional reforms; they would lose a lot of money. They are more concerned in preserving profit rather than distributing it to the people through fair trade practices. They failed to realize that if riches were equitably distributed, they would also gain from it. Higher consumption power naturally results to more profit because more and more people would be able to purchase their products. But, most investors think that it is better to place the increase and decrease of the share value as the central indicator in profitability. Rather than listening to the pulse of the consumers, they look at trends in the stock market. That is why they have aversion in allowing full FDIs.
Globally, the People’s Republic of China fall into the definition of an emerging superpower. It has a vast economy, numerous military and vast sway over neighboring states. While there are still admittedly numerous flaws, it is still evidently becoming an emerging superpower. As a country, there are 3 options – resist PRC, comply with PRC or maintain a neutral stance towards PRC. The first option is not a tenable one because economically, Philippines will not survive warfare with China. Secondly, if it is sued in an international court, it would not respect its jurisdiction. Lastly, Philippines cannot untangle completely from it due to economic restrictions to Foreign Direct Investment and the aversion of most Multinational companies from shady and unfair corporate practices.
In the second option, Philippines will become a lapdog of China. This was done by the administration but what happened? PRC disregarded Filipino interests. In fact, PRC has a new law allowing shooting of Filipino vessels in their own sovereign waters! In addition, crimes were also imported into the Philippines. Illegal Offshore Gambling Operations sprang up everywhere which trafficked men and women alike. From them, more and more drugs came into the country. For this option, Philippines is still the loser.
In the third option, Philippines would become a neutral partner of China. It neither resists nor submits completely to PRC, maintaining friendly trade but on certain issues such as national territory, there is defiance and upholding of international law. While PRC may have a stronger military, Philippines still use international law as a means of ceasefire. Through collaboration with other countries, Philippines may be able to form a defensive bloc to counter Chinese imperialistic aggression while maintaining a neutral stance. In this neutrality, Philippines would still maintain economic ties with China but militarily, countering aggressive Chinese expansion.
An alternative option to the three choices is to open FDI on equities. This is a supplementary option but would greatly increase the benefits Filipinos reap. This will allow jobs to pour into the country which would help many Filipinos to greatly improve their current standards of living. This is with the mindset that upon examination of other countries like Vietnam. Vietnam was poorer than the Philippines but because of granting 100% FDI, it gained economic mobility and gave many Vietnamese jobs which made them more satisfied with their government. On the other hand, there is only a few job opportunities in the Philippines. Few opportunities meant more disgruntled people and more disgruntled people means lower satisfaction in life. This is why opening up Foreign investment would solve a lot of problems in the Philippines.
Many Filipinos have suffered under the wrath of bad Filipino employers. Some had suffered even worse abroad as domestic helpers, truck drivers, construction workers and the like. There is an increasing brain drain in the Philippines and without a clear solution, more and more Filipinos would opt to leave the country to work in other nations that appreciate their potential and worth. It is not enough to pray for this problem to go away. Does anyone like to sleep in a ramshackle house? Does anyone like to suffer eating bagoong or Soy Sauce just to budget the small amount of wage that majority of Filipinos earn? No one wants to live a poor life. Everyone wants to have at least a decent life where they have a comfortable house to sleep on and good food to eat. Yet, even religious teachings have exalted the blessedness of being poor forgetting that it refers to being poor in spirit. They celebrate the inability of many Filipinos to afford a decent life, stating that it is a sign of humility. This is wrong. In addition to that, many have also become influenced to hate liberalization of the economy; serving as a hindrance wherein many have found it difficult for jobs to enter the Philippines.
Why do BPOs under foreign accounts are better aside from higher pay? One of the reasons is the culture. In these accounts, certain characteristics of a western workplace were embraced such as meritocracy, freedom and individualism, more incentives were given and it guaranteed promotion. In a typical Filipino workplace, hard work does not lead to promotion or raise in salary. Most often, it is either thank you for doing your job or in some cases, ridicule. Yes, going an extra mile under a Filipino management leads to being ostracized. That is why, FDI are needed in the country because those who really work hard were not given appreciation.
Is this the right time for constitutional reforms? Given the problems in this country and all the arguments mentioned above, this is the proper time. This is the time to change the system for the betterment of many. This is the time to change it so that those who truly put in labor would be given their due. Truly, Philippines has much potential but because of xenophobia and greed of the 1% of Filipinos, the rest suffer from systemic maladies. So, this is the right time for constitutional reforms.