Corruption continues

EDITORIAL

President Aquino ran on the platform “Kung Walang Corrupt, Walang Mahirap.” Regrettably, nine months into his presidency, the perception of corruption continues.

According to the 2011 report by the Political and Economic Risk Consultancy, the Philippines ranked 14th among 16 countries and regions, “The results of the PERC survey reveals how foreigners see the Philippines as an investment destination or a place to do business. This trend has to be reversed if Mr. Aquino would like his public-private partnership (PPP) initiative to take off.”

While the Philippines’ rank has remained unchanged, its grade has worsened: from 8.25 in 2010 to 8.90 in 2011. The grades are scaled from 0 to 10, with 10 being the most corrupt.
Economist Benjamin Diokno says results of the PERC report is complementary to a recent Pulse Asia survey which suggests that corruption in the Philippines has remained persistently high.

The survey reported that half of Filipinos (48.9 percent) perceived that the Armed Forces of the Philippines is the ‘most corrupt’ government agency, followed by the Philippine National Police (26.6 percent), and the Department of Public Works and Highways (18.2 percent).

The results of the PERC survey are different from results of the Pulse Asia survey in two ways. First, the respondents in the PERC survey are foreign businessmen and senior expatriates doing business in the Philippines while the respondents for the Pulse Asia surveys are 1,200 representative Filipino adults 18 years old and above.

Second, the PERC survey was done through the mail and interviews in January and February 2011, slightly before the full blown revelation of corruption in the military before the Philippine Senate. The Pulse Asia face-to-face interviews were done in February 24- March 6, 2011 long after the widespread corruption in the military was made known.

According to Diokno, results of the PERC survey reveals how foreigners see the Philippines as an investment destination or a place to do business. There is a strong correlation between perception and actual investment behavior. Last year, foreign directly investments (FDIs) contracted by 13 percent while some of the Philippines neighboring countries enjoyed growth in FDIs.

This trend has to be reversed if Mr. Aquino would like his public-private partnership (PPP) initiative to take off. The perception that corruption is being controlled has to take root if Mr. Aquino would like to inject life into his anti-corruption, anti-poverty platform.

If Mr. Aquino wants to attract more foreign investment into the country, Diokno says, he will have to dig it out of its deep hole. On it depends his success in achieving a program of strong, sustained inclusive GDP growth of 7 to 8 percent.

“Mr. Aquino’s predecessor has the unprecedented record of putting the Philippines in its deepest corruption hole — as a country and relative to its Asean-5 neighbors. In 2000, the Philippines ranked 39.3 percentile (meaning the country is better in terms of control of corruption than 39.3 percent of the 200+ countries included in the World Bank Governance Indicators survey). In 2009, the latest available data, the Philippines ranked 27.1 percentile, or a loss of 12 percentile points.”

Other ASEAN-5 countries, on the other hand, have scored higher than the Philippines. Malaysia, from 66.0 percentile rank in 2000 to 58.1 percentile rank in 2009; Thailand from 49.5 to 51.0 percentile rank; Vietnam from 29.1 to 36.7 percentile rank; and Indonesia, from 16.0 to 28.1 percentile rank.

In 2000, Diokno points out, the Philippines outranked Vietnam and Indonesia in controlling corruption; by the time Mrs. Macapagal-Arroyo left Malacañang, the country lagged behind Vietnam and Indonesia in the war against corruption.

“Perhaps, corruption is so entrenched that no quick turnaround can be expected within nine months. An honest president, with no visible strong support from even a few good men may not be enough to reverse the tide of corruption and to release the bureaucracy from the entrenched hold of forces of the previous regime. The triple-headed propaganda machine may be no match to the tasks before it or perhaps it is simply inept.”

More from Diokno: “The social, economic and political terrain has changed so much since Mr. Aquino assumed office in June 30. 2011. He made a few mistakes along the way. There were few gains but there were more setbacks.

“In the meantime, the world has changed for the worse– Europe is more heavily indebted, the Middle East and Northern Africa is in the midst of a political crisis, Japan is hobbled by the triple tragedy, and the threat of climate change has become more real than imagined.

“These challenges require bolder actions. His anti-corruption fight has not caught fire at best or has stalled at worst. To date, one gets the sense that Mr. Aquino has not done enough. He has to regroup.

“Perhaps, Mr. Aquino should have started his watch with an authority from Congress to reorganize the whole bureaucracy within 100 days. It’s not too late. With an imprimatur from Congress to reinvent the bureaucracy, he could then remove the remnants of the old regime and bring in new blood (including those who ran and lost in the May 2010 elections).

This way, he could give his presidency a new look and a new beginning. This time, hopefully, it will be forward-looking, purposive, energetic and decisive.”