PGMA's Speech during the 29th Philippine Business Conference and Exhibition

PGMA's Speech during the 29th Philippine Business Conference and Exhibition

Manila Hotel, Roxas Blvd., Manila (28 Nov. 2003)

Thank you very much, Jun.

Don Emilio Yap; Samie; Mike; Dr. Lucio Tan; Robin; Francis Chua; Peter Favila; Ann Marie Periquet; members of the diplomatic corps and international organizations; members and officers of the PCCI; members and officials of local chambers; regional governors and industry associations; nominees and awardees; honored guests; my Cabinet members; other government officials; movers and shakers of commerce and industry, good morning and a happy centennial anniversary to the chamber.

This morning, I would like to begin by counting a couple of blessings: our 5.9 percent GNP growth rate; our 4.4 percent GDP growth rate; our 22 percent growth in BOI and PEZA investments. These figures are higher than expected and while historically our economic development has been slow compared to our neighbors, this time we outperformed Taiwan, Indonesia, Singapore and South Korea. In fact, in the last two and a half years of my administration, for most of that time, we have been outperforming 15 of the 21 economies of the Asia-Pacific region. Notwithstanding that there was a lot world chaos, notwithstanding that I Inherited chaos, we were able to do that in this last two and a half years. But this last reported growth -- 5.9 and 4.4 -- that is our highest since the Asian crisis of 1997.

Agriculture and investments spending led the way. Macroeconomic fundamentals and aggressive agricultural modernization are paying off. It was the government who worked on the macroeconomic reform and the agricultural modernization. But the one who provided the growth, the one who provided the investment, the one who led the way to these figures were you the members of the business community. And some of those who led these growth and led these investments are right here in this hall today. They are leaders and members of the PCCI. And therefore I take this opportunity to thank you for your support.

Thank you for your support. Thank you for your investments. Thank you for your production. While others may give their opinion in words, you have given your opinion in deeds and in the dollars and pesos that you put in these investments and in this production. Thank you for your vision.

One global Philippines. I agree. To be one, we need to unite as a nation. To be global, we need fundamental changes in our system of doing politics and economics. And to be Filipino we should be proud that we have world class human resources, who not only contributed to our 4.4 percent growth rate in GDP but who also contribute to the production of countries all over the world and send back their remittances that bring about the multiplier that translates our 4.4 GDP into a 5.9 percent GNP growth rate.

In the last two and a half years of my presidency, I have gone through a learning curve. This learning curve has helped me identify on the ground what are these fundamental changes we must make in order to be truly global and how to execute them.

We need five fundamental reforms that more or less -- as I look very quickly at your resolutions -- conform to the ten resolutions that you gave me. In terms of the five, it's reforming the market, reforming agriculture, reforming our social assets, reforming the bureaucracy, and reforming our institutions that uphold peace and order

On the first, market reforms. I am proud of our initial market reforms on the economic front. They have kept our growth on the upward path -- I've just mentioned earlier during this last two and a half years - despite the chaotic conditions I inherited and despite the grave challenges that the world itself is facing today. Fiscal prudence has kept the deficit within reasonable ceilings that's why inflation and interest rates are low.

Confidence in our political stability has held steady in the face of judicious resolution of the Oakwood incident, in the face of our gains against terrorism, and in the face of the diminishing tremors of destabilization now that the electoral fever is catching on.

But let me speak about a reform that we all recognize must be done. Let me speak about crime. You can fight crime by rub outs, but the same people who will do the rubout on a kidnapper will be the same people that will do a rubout on a Bubby Dacer. It will be the same people that will do a rubout on their political enemies. And therefore, it is going to be solved not by this double-edged swords but rather by immediate medium-term and long-term reforms.

The problem of kidnapping straddles a broad spectrum of activities, ranging from deterrence to neutralization, prosecution and final conviction of kidnappers. In the last five years, including before I became president, there had been more than 400 kidnapping cases. Thirty-six have resulted in conviction. Most of these convictions were done in my time, accomplished in my administration even if the crimes were perpetuated before my time.

Nonetheless, because we want to solve these crimes in a more effective way, last month, I appointed Secretary Angelo Reyes as our anti-kidnapping czar. In the one month of his operations, he has implemented 22 campaigns targeting six active kidnap-for-ransom group. His men arrested the man who kidnapped Connie Wong way back in 2001. His men have arrested three kidnappers of Betti Chua Sy one day after the crime was perpetrated. And these are just as important as the macroeconomic fundamentals and the agricultural modernization that we are doing.

The day after the arrest of Betti Chua Sy's kidnappers, Angie's men killed the most notorious kidnap gang leader of them all, Roberto Obeles Yap, together with some of his cohorts, and arrested several other members of that gang in Bataan and Cabanatuan. His men have captured Abu Sophia kidnapper gang members in Mindanao. And his men have also been able to have several other arrests and captures that I will no longer mention because I picked the few household names just to show you how he has been catching up very quickly in one month's time.

Angie has also been conducting lectures and seminars to selected Chinese groups and communities designed to harden potential targets of kidnapping. Prominent private schools in Manila and Quezon City have also been invited to participate in this preemptive anti-kidnap drive.

I have also authorized Angie Reyes to establish additional police outposts that may double as assistance centers located in areas where, according to his study, kidnappings may occur. Policemen will be made to walk the beat in order to show police presence. Mobile and fixed checkpoints shall be conducted. Choke points going to metro manila will be watched. Heavily tinted vehicles will be checked. Armed men and uniformed men riding in civilian vehicles will be challenged. Vehicles with questionable plate numbers will be questioned. Special plates are not exempt from inspection.

We are also including kidnap-for-ransom personalities in the government rewards list for most wanted persons. I am making available 300 million pesos for these rewards. Pictures will be published in newspapers and posted in conspicuous places such as bus terminals, public schools, public markets, private schools and target communities. These are what we are doing in the immediate term, but in the medium-term we need more reforms.

In the medium-term or short and medium term, I shall certify a bill that will add more teeth to laws dealing with kidnapping. I am instructing the Department of Justice to make the witness protection program more responsive to kidnap victims. I'm also pushing for the implementation of the national id system. And of course... Yes, thank you. Thank you for agreeing. I hope the members of congress who are here will hear that-- Monico Puentevella. We shall further develop our capability for intelligence.

These are short and medium term reforms. But in the longer term we need fundamentally to reform our protective institutions. We increased the salaries of policemen and military personnel to the level of teachers during my administration. And I'm very glad that in the reforms we had made in the anti-drug campaign we have achieved unprecedented success in our drive against illegal drugs. Many of those who used to be untouchable in previous supposed drug campaigns have been touched and arrested and neutralized today.

But as I said, we need to fundamentally reform the military and the police, towards graft-free and dedicated organizations with the tools to enforce peace and order throughout the land, and to be true protectors of the people.

I want to thank the leaders of the PCCI, Mike and the other leaders, Jun, Donald, the members of the federation of the Filipino-Chinese chambers, because they were active in the PNP... No, in the Feliciano Commission and also in the PNP Reform Commission that will give us the road map for police reform. And that's why I'm glad that part of the resolutions is about the governance regarding peace and order because our road map has and will have a significant institutional contribution from no less than the PCCI itself. And I thank you for that. On military reforms, our major non-NATO ally status with the United States will enable us to have a modern armed forces with less pain to the economy.

But going back to market reforms. As I said, I am proud of the initial reforms such as what we could do in two and a half years. But we need structural reforms for the government to broaden its fiscal controls and capabilities, provide the infrastructure and the education needed to leverage the nation's competitive advantages, and promote a business-friendly environment based on good governance and a strong, deep financial and banking system.

The next key area for reform is the electric power industry reform. And I am very happy to receive again the inputs of the chamber because the details of these reforms I talked about -- infrastructure, education and human resource development -- are things that we will put together, PCCI and the Philippine government.

Meanwhile, speaking about electric power, I am requesting the Energy Regulatory Commission to work with Meralco and the PCCI to formulate a program to speed up the ongoing consumer refund program, so that industry can benefit from refunds as well.

We achieved our growth rate this third quarter with great advances in agriculture, and that is part of our key to the future because most of poor lived there and because we need it para magkaroon ng pagkain sa bawat mesa. We must liberate the country with reforms not only in the market but in agriculture. For agricultural modernization, my administration spends at least 20 billion pesos a year on agricultural modernization. This is the highest annual allocation in our history. A great part of this is for irrigation. We have also irrigated the biggest number of hectares in history.

I see here Henry Lim, a member of your chamber. He has a great contribution to our agricultural modernization, because his rice hybrid has doubled the income... Ah, no not the income but the harvest of the farmers. We have adopted the Chinese rice hybrid system.

A hundred thousand hectares are now planted to this rice hybrid, and we can attribute that massive growth of agriculture in the third quarter to the 20 percent growth in rice production because of that rice hybrid. From the 100,000 hectares that we have been able to plant since we introduced this rice hybrid, we now want to bring it to 600,000 hectares in the next two years.

We have found new markets for tuna, Carrageenan, tropical fruits. And i'm directing Secretary Cito Lorenzo here to work with Secretary Emi Boncodin for the remaining balance of the agricultural competitiveness enhancement fund. Things I have learned are important to you because of my learning curve in the last two and a half years.

As a boost to agriculture, the Ro-Ro Highway System is now reducing the cost of food transport from Mindanao to Luzon. I have noted the concern of the chamber over the 50-mile limit for cargo and handling charges for Ro-Ro users exemptions. So, in response to your concern, I have removed the 50-mile limit. That is why we now have a new Ro-Ro route from Cagayan de Oro to Dumaguete to Manila.

We must also have social reform, asset reform. Reform of our assets such as land, housing and credit. On credit, small enterprises are on a roll. They are fuelled by low interest loans and more than 16 billion pesos had been made and availed of by almost 200,000 small and medium enterprises in this year alone.

We are providing microcredit to one million assetless, incomeless rural women. And we're being praised for this microcredit program by no less than the author of the Grameen bank model himself, Dr. Yunos. But beyond that, beyond the 16 billion for SMEs, beyond the micro for one million women, if we're able to do fiscal and banking reforms, we can do even more and we can allow a one-time seed fund of one million in microfinance per barangay as proven successful in Thailand, as you all very well know, because I invited Prime Minister Thaksin to speak before you so that you will know the model I am following in the reforms that we want to make for our small, medium and micro enterprise system. And if you remember last year, I announced the passage of the law on barangay micro enterprises.

Upon the PCCI's recommendation, I am directing Secretary Joey Lina to coordinate with the agencies on the local government level for a stepped up campaign on this barangay microbusiness enterprise law. I announced it to you last year but it takes time for it to reach the barangay level. So let us work on an information campaign.

On housing. Our socialized housing program is also part of the most massive land social reform program we have had in history. And I am very happy by the repeated statement of the housing associations, they feel that our housing program is successful because my government has the most housing-friendly policies in history. That's coming from the housing sector itself not from me. And i am happy that the PCCI has taken up the advocacy of further accelerating our housing program.

These programs are such as what we could do during a learning curve period, during a period of great world instability, during a period of strife even within our country. But we can transform them and make them graduate into fundamental reforms if we work hard enough on governance reform. Again, through my two and a half years of the learning curve, I have learned the complexities of dealing with the bureaucracy. You can't learn that by theory.

The World Bank has praised our vigilant advances in fighting corruption. It has acknowledged that we have been effective in our lifestyle checks and in our procurement reforms. The government E-Procurement Law which I signed early this year is one giant step in instituting transparency. The people's dissatisfaction about day to day government services are also being addressed. There had been dramatic changes in the land transportation office. And I have been doing surprise visits to police stations.

We must end graft with the mighty hand of political will and a change of values among our citizenry. But do not believe those who will tell you that graft can be slained with one fell swoop of a sword like St. Michael slaying the dragon. Have we not forgotten how we put all our support behind Rene Ba�ez because he was going to use the St. Michael method to slay the dragon of corruption in the BIR. What was the result, one-half year of our achieving only one-half of our revenue targets for that 6 month period. No, fighting corruption is like an infected... Curing an infected wound that must constantly be cleansed and disinfected until it is gone. That has been the system in the BIR under Willy Parayno, it's been the system in the BOC under Titus Villanueva, and now under Tony Bernardo. And now, we are meeting our revenue targets.

At the same time, we must use our fiscal reforms to have a better compensated civil service. That is one of the most important reforms we can make in governance. And we can only do that if we can reform our fiscal programs.

We must also reform our very political system through constitutional change. And I thank the PCCI for helping me propagate that view. We must make our constitution more applicable to the challenges of the 21st century, especially because the PCCI wants the nation to be global.

But in many ways, even now we are already global. Look at our growth rates compared to our neighbors. Look at our human resources lording it over many management jobs in many parts of the world. Yes, we are a people who are world class but then, why are we so miserable?

It is because this current environment is an environment in which -- and I don't blame you all here today, it's an environment I inherited -- it's an environment in which we delight in the things that divide us more than the things that unite us.

There is too much negativism and conflict in our society today, and I attribute much of these to the social and political divisions that existing our nation today. We need to heal these deep divisions. While we must have justice, we must also have reconciliation. We must put a closure to our past national divisions. And I must thank the PCCI because you were one of the first to understand and support my call for reconciliation.

Because if we are to survive and even flourish in the 21st century as our comparative growth rates have shown, we can survive and flourish. National unity and reconciliation is the resolution that is non-negotiable. We must be relentless in the pursuit not only of the fundamental changes in our system of politics and economics, we must also be resolute in our pursuit of unity.

No fear, no resistance should distract us from our vision. Our nightmares, the nightmares we have gone through in the last five years, the nightmares the world is undergoing should not distract us from our dreams. Our dream of being one. Our dream of being global. Our dream of being proud Filipinos.

Thank you, PCCI for articulating these dreams.

And thank you for acting on them with your investments and your production.

Mabuhay! Happy 100th Anniversary to all of you.

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