\nFormer president Gloria Arroyo’s press release this week complaining that the new government has squandered economic gains achieved during her administration was launched by her spokespersons on the same day a couple of international organizations separately issued reports portraying better prospects for the Philippines on account of recently improved management and resiliency of the economy.<br n\/><br n\/>Not only did it suffer from bad timing, the Arroyo press release on Thursday failed to measure up to its label as an “economic paper” that was read at what was described as a “colloquium." Only media representatives were present and no panel of experts probed deeper into the former president’s thesis.<br n\/><br n\/>If indeed the released material will form part of a memoir she is reportedly writing, then Mrs. Arroyo will need to do a more careful review of her facts so that her forthcoming work will not be ignored by the market and give the city trash collectors a problem in deciding whether it is recyclable or not.<br n\/><br n\/>While the Arroyo press release, titled “It’s the Economy, Student!”, painted a grim picture of the economy under the administration of President Benigno Aquino III, newly released reports from Bank of America Merrill Lynch, HSBC Global Research, and the Heritage Foundation all noted improved Philippine economic fundamentals in recent months, projecting rosier prospects in the coming years.<br n\/><br n\/>BoA Merrill Lynch cited the Philippines’ “improving” resilience indicators that could help the country weather the current global economic turbulence caused by a growth slowdown in leading industrialized economies in the West.<br n\/><br n\/>HSBC added its own positive view by projecting that the Philippines will join global growth leaders and emerge the 16th largest economy in the world by the year 2050.<br n\/><br n\/>The report said China will overtake the United States as the world’s biggest economy by 2050, while other developing countries are seen driving global expansion with “strong growth rates.”<br n\/><br n\/>In Asia, the report said the Philippines will be “the star performer,” with an average annual growth rate of 7 percent that will be driven by a combination of “strong growth fundamentals and powerful demographics.”<br n\/><br n\/>Another report, the 2012 Index of Economic Freedom by the Washington-based The Heritage Foundation and The Wall Street Journal, gave the Philippines a higher overall score following improved performance on business freedom, labor freedom, monetary freedom, and fiscal freedom over the past year.<br n\/><br n\/>These new findings contradict Mrs. Arroyo’s argument that the Aquino government focuses mainly on “politics of division” while exhibiting a “vacuum of leadership, vision, energy and execution in managing our economic affairs.”<br n\/><br n\/>Even on economic performance, the former president’s article obviously is guilty of exaggeration in some parts and omission in others, particularly in the wealth inequality that resulted from the economic growth during her term.<br n\/><br n\/>The paper is “self-serving,” says Dr. Dante B. Canlas, the chairman of the dissertation committee that evaluated Mrs. Arroyo’s thesis for her economics doctoral degree at the University of the Philippines School of Economics in 1985. He is formerly an Arroyo administration Socioeconomic Planning Secretary and NEDA Director-General, replaced later by Romulo Neri.<br n\/><br n\/>Dr. Canlas feels that the title of Mrs. Arroyo’s paper should be “It’s Also About Good Governance, Teacher!” in reference to the widespread perceptions of corruption during the previous administration.<br n\/><br n\/>“Development,” he pointed out in an interview, “won’t take place unless top political leaders — past, present, and future — don’t quit using state resources to advance their own interest.”<br n\/><br n\/>Also, former prime minister and finance minister Cesar Virata sees “signs of economic improvement” this year, after a slower expansion in 2011 compared to the high growth of 2010 that he said was characterized by “high election spending.”<br n\/><br n\/>Mr. Virata, who in 1980s oversaw the difficult recovery from the harsh economic conditions brought about by the Marcos regime’s declaration of a debt moratorium in 1983, noted that while under-spending in public construction in 2011 came about due to delays in the implementation of projects under the Aquino administration’s public-private partnerships (PPPs) program, it also resulted in an improved budget deficit position.<br n\/><br n\/>The lower budget deficit along with an increase in financial reserves, said Mr. Virata in a January 13 essay for the East Asia Forum newsletter, bolstered international rating agencies’ outlook on the Philippines.<br n\/><br n\/>For this year, Mr. Virata projected a “likely" positive growth rate of about 4.5-5 percent as the government moves to implement “reform-minded” projects and programs, and facilitate investment.<br n\/><br n\/>Mr. Virata cited the Aquino administration’s “vigorous” anti-corruption campaign, plans for greater government transparency and accountability, social programs addressing povery alleviation, improved education and health programs, along with a number of PPPs for major infrastructure projects.<br n\/><br n\/>Contrary to the gloomy outlook owing to the deteriorating economic situation in Europe, Japan and the US as portrayed by Mrs. Arroyo in her press release, Mr. Virata offered a more positive scenario: he said that while the Philippines is not immune to these global problems, the country’s exposure to European credit is quite low and a credit squeeze there will likely have little effect.<br n\/><br n\/>On the other hand, Mr. Virata said, “European exposure in the Philippines — in both the private and public sectors — could be sold in the market and be picked up by other international or Philippine institutions.”<br n\/><br n\/>Meanwhile, even with the impeachment trial of Supreme Court Chief Justice Renato Corona, and its potential for “distractions” in both the public and private sectors, “I remain hopeful that the first half of 2012 will see the much-awaited start of a public infrastructure program to boost economic growth over the medium term,” Mr. Virata said in his East Asia Forum essay.<br n\/><br n\/>East Asia Forum offers “high-quality economic research” aimed at assisting policymakers in responding to, and anticipating, issues confronting the economies in the region. Its members include 25 research institutions from 11 countries in East Asia, including the Philippine Institute for Development Studies.<br n\/><br n\/>Other independent assessments made in the recent past by international institutions provide an enlightened assessment of Mrs. Arroyo’s claims on economic growth.<br n\/><br n\/>For instance, while Mrs. Arroyo laments that President Aquino has failed to continue her accomplishments during “38 quarters of uninterrupted economic growth,” such growth has failed to propel the country into a competitive position, said an Asian Development Bank-commissioned report released in May 2010.<br n\/><br n\/>The ADB report noted that while most of its neighbors in Asia successfully conquered “complex challenges” in surging ahead towards prosperity, the Philippines remained caught in a “middle income trap.”<br n\/><br n\/>A middle income trap is a situation where a country achieves a certain level of economic development but cannot rise further because it can't compete with both the low-cost producers at the lower end of the market and the advanced economies at the high end either.<br n\/><br n\/>While many of its neighbors nimbly overcame their own challenges and went on to deliver better lives to their citizens, the Philippines lingered in this middle income limbo — contrary to claims made by the Arroyo paper.<br n\/><br n\/>Another report, titled “Philippines Discussion Notes: Challenges and Options for 2010 and Beyond” and drafted by economists at the World Bank Manila Office to “help inform policy discussions… among government, civil society, business groups, and development partners” during that election year, noted that at the time “an estimated 33 percent of the population lived under the poverty line, up from 30 percent in 2003, and nearly half remain highly vulnerable to falling into poverty or deeper into poverty.”<br n\/><br n\/>The World Bank report said that in 2003-2006 poverty indicators in the Philippines failed to decline even though GDP growth had picked up significantly. “This suggests that the benefits of growth during that period were not being widely shared. Rather, the increase in economic growth appears to have been accompanied by a significant deterioration in the distribution of income and consumption.”<br n\/><br n\/>The poverty incidence rate increased between 2006 and 2010, adds Dr. Canlas, adding that “distribution of income as of 2010 was highly unequal, with a Gini ratio of more than 45 percent, which means a large chunk of national income, at least 80 percent is concentrated in the top 10 percent.”<br n\/><br n\/>The Arroyo press release’s claim that during her term the country was able to “weather with flying colors the worst planet-wide economic downturn” of 2008-2009 is belied by findings that the Philippines was among those that suffered severely, with GDP growth estimated at nearly flat (even posting a negative result by some independent estimates) while job losses swept a wide range of industries.<br n\/><br n\/>But it is high incidence of corruption that is often raised against the administration of Mrs. Arroyo. The World Bank Discussion Notes recalled a poll of world opinion makers conducted by the World Bank in 2008 which showed that respondents in the Philippines were “the only ones among those polled in East Asia who identified ‘improving governance’ as the most important means to generate faster growth in their own country. “<br n\/><br n\/>“Corruption diverts public resources and denies the poor access to schools, health care and other basic services. The impact of public investments is diluted and public confidence in the government eroded when funds are siphoned off by corrupt intermediaries,” the report said.<br n\/><br n\/>Calling for measures to curb corruption and uplift governance standards, the World Bank report said that the “reputation and legacy of the government will be largely determined by its record on improving governance. “<br n\/><br n\/>That makes Mrs. Arroyo’s harangue against the current campaign by the Aquino administration to root out corruption difficult to understand.<br n\/><br n\/>Highly respected economist Jeffrey Sachs wrote recently about the need for moral leadership. “The world’s greatest shortage,” he said in an article for Project Syndicate, “is not of oil, clean water, or food, but of moral leadership.”<br n\/><br n\/>“With a commitment to truth – scientific, ethical, and personal – a society can overcome the many crises of poverty, disease, hunger, and instability that confront us,” he said in a tribute to the late Vaclav Havel, the idealist and playwright who became president of the Czech Republic.<br n\/><br n\/>Moral leadership and truth should be the primordial concerns when a real assessment of the Arroyo administration’s claimed accomplishments on the economic front and elsewhere is made.