A Duterte presidency will not lead to a loss of investments or economic ruin as some critics have warned, according to a professor of Economics at the University of Santo Tomas.
Professor Emmanuel Lopez, who has a doctorate in economics and is chair of the economics department at UST’s Faculty of Arts and Letters, said that the business community may be “very jittery” because of the elections, but he expects things to stabilize once Duterte – who is expected to be proclaimed president-elect in coming days – names his economic managers.
“I think it will not happen,” he said of warnings that Duterte, whose campaign focused on a promise to eradicate drugs and crime, may be detrimental to the country’s economic growth. He said that the business community will stabilize “after the smoke of battle has cleared” and the new president appoints a Finance secretary and names officials to bodies like the Board of Investments.
The Manila Times reported on May 8 that a London-based think tank said Duterte might undo the gains of recent years, when gross domestic product grew an average of 6.3 percent according to government data. The report quoted Capital Economics Asia economist Gareth Leather as saying “there is a real risk that Aquino’s most important achievements could quickly start to unravel.”
The camp of Liberal Party standard-bearer Manuel “Mar” Roxas – at a distant second place according to partial election results – also criticized Duterte for not discussing economic policies at a forum with the Makati Business Club in April.
“Ignorance about the economy cannot be remedied by hiring advisers. The candidate must have a good grasp of the issues and take the matter seriously. This is an issue that involves jobs, income, and price of goods. This is a matter of life for our families,” Akbayan Rep. Ibarra Gutierrez, Daang Matuwid coalition spokesperson, said.
MBC members, including chair Ramon Del Rosario Jr., said after the forum that they had hoped that Duterte would have talked about his proposed economic policies.
But Lopez said that Philippine economic policies will remain the same for about a year into Duterte’s administration, with any changes coming gradually. “Of course, there has to be a transition [period], especially after six years,” he said, adding the Duterte administration will have little choice but to maintain the status quo in the meantime.
In debates and campaign speeches, Duterte has indicated that he will put an end to labor contractualization – hiring employees for short periods without government-mandated benefits – but has also called on labor unions to let him implement his plans before going on strike or holding protests.
Lopez added that Duterte’s focus on peace and order might even convince investors to come in if the Davao City mayor makes good on a campaign promise to minimize crime within three to six months.
He said that Duterte should focus on making economic growth inclusive. The Aquino administration has been criticized for supposedly failing to translate GDP growth into improving the lives of Filipinos in the lower and middle classes and analysts have said that resentment at that helped fuel the Duterte campaign.
“It should go down to the grass roots,” Lopez said of any economic gains under Duterte.
Source and image: Philstar