The lack of experience, corruption and nepotism in the Philippine political scene would likely worsen instability and underpin the underperformance of the country’s ailing economy, according to a UK economic think tank.
“A lack of policy-making experience, corruption and nepotism have all contributed to political instability,” economist Gareth Leather of the London-based research firm Capital Economics said in a statement on Friday.
“[Instability] has been a key factor behind the underperformance of the economy over recent decades,” Leather said, citing World Bank (WB) governance indicators.
According to the WB, the Philippines’ average political stability rating from 1996 to 2020 was among the worst in Asia.
In a ratings range with a maximum score of positive 2.5 and the lowest at negative 2.5, the Philippines’ score was over negative 1.
“The next presidential election in the Philippines is not until May [2022], but the contest is already generating plenty of headlines with former boxing world champion Manny Pacquiao this week announcing his intention to run,” Capital Economics noted.
Leather said, “name recognition goes a long way in Philippine politics, which explains why actors and the children of former presidents account for three of the last four presidents.”
“However, name recognition doesn’t correlate with skill in governing,” Capital Economics said, pointing out that the Philippines was not in good shape what with its worst economic recession since World War II and continuing struggle with the COVID-19 pandemic.
The UK think tank estimated in a Sept. 29 report that the Philippines’ gross domestic product (GDP) was “likely to have seen only a lackluster rebound in the third quarter due to a renewed surge in virus cases and the reintroduction of containment measures.”
Less than 20% vaccinated
“Our mobility tracker shows that while the movement of people has risen again following an easing of restrictions in Manila earlier this month, it is still around 35 percent below prepandemic levels,” Capital Economics said.
“Vaccination continues to progress slowly. So far, less than 20 percent of the population have been fully jabbed and the government is unlikely to reach its target of fully inoculating 70 percent of the population before the end of 2021,” it added.5% PH growth this year
Capital Economics expects the Philippine economy to grow by 5 percent this year, hitting the upper end of the government’s downscaled 4 to 5 percent target range.
Due to low-base effects, Capital Economics projected GDP growth jumping 11 percent next year and 9 percent in 2023, reversing the record 9.6-percent contraction in economic output last year.
Last February, Capital Economics said the Philippines was poised to become the world’s 18th-largest economy by 2050 if it can improve its “dreadful” infrastructure.
The Inquirer reported Capital Economics’ optimism that Philippine nominal GDP could climb to $4.86 trillion three decades from now, such that nominal GDP per capita would also rise to $33,650.
In 2019 or before the COVID-19 pandemic struck, the Philippines’ nominal GDP was the 30th biggest in the world.
Among Association of Southeast Asian Nations member countries, while the Philippines could overtake by 2050 Thailand’s nominal GDP, which in 2019 ranked a higher 23rd, its ascent would be eclipsed by neighboring Indonesia and Vietnam.