Noninclusive economic growth
The second quarter of the year will be over in five weeks and we will soon be halfway through 2023.
According to Socioeconomic Planning Secretary Arsenio Balisacan, the first quarter of this year had shown a 6.4-percent growth in the country’s gross domestic product (GDP) or the sum total of the monetary value of final goods and services produced in the Philippines.
Although he described that growth as an auspicious beginning for 2023, he admitted that high inflation remained a challenge and that the actions taken by the Bangko Sentral ng Pilipinas to bring that down may dampen future growth.
Unlike in prepandemic years when the quarterly GDPs were, more or less, within the same range, there was (mercifully) no drumbeating about that performance from the present administration.
In the past, that growth percentage was reason enough for some government officials to rejoice as it looked good for international credit rating purposes or make optimistic forecasts about the country’s economic progress.
And following that line of thinking, that the majority of Filipinos, especially those in the D and E sectors, would benefit from it by way of more affordable basic commodities or an increase in the purchasing power of their wages.
In theory, or based on economic strategy tables, that should happen, but the reality on the ground is the supposed “trickle down” effect of that economic development was hardly, if at all, felt by their intended beneficiary.
Thus, organized labor cannot be faulted for describing past GDP growth announcements as government propaganda that did not make any difference in the lives of rank-and-file workers.
That GDP forecasts or reports are valuable tools for economic planning in the public and private sectors is not in dispute.
They give the government and the business community a bird’s eye of view of the nature, extent and value of economic activities in the Philippines in a particular period.
In addition, by tradition and practice, the GDP is viewed as a gauge or determinant of the economic performance of the government at the time of its measurement.
If the GDP shows favorable results, i.e., higher than the preceding quarter or year, it gives the impression to local and foreign financial analysts that the economy is being managed properly.
On the other hand, if it is lower, doubts are usually raised about the ability of the government to take a grip of the factors that caused that unhealthy economic condition.
And when the contraction in economic activities happens in two consecutive periods, fears of an impending or actual recession tend to raise jitters in the business community.
In other words, the GDP is a double-edged sword.
As presently measured and interpreted, the GDP can hardly be considered a fair, much less accurate, measurement of the state of the country’s economy, especially in relation to the people it is supposed to support.
Its facts and figures do not show how the economic benefits of the 6.4-percent growth in the GDP were shared, if at all, among the different sectors of society.
For example, who gained the most in the increase in agricultural production? The farmers who planted the crops and had to quickly sell them before they rot? Or the traders who bought them at low prices and sold them at artificially high prices?
And did the GDP growth during the first quarter bring down the prices of food products, lower the costs of transportation or enhance the government’s ability to provide financial assistance to the poorest of the poor?
What good are growths in GDP if their resultant value is enjoyed only by a select few, or the proverbial 1 percent, and not by the 99 percent who have to contend with the present high cost of living?
For comments, please send your email to “firstname.lastname@example.org.”
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.