The initiative is just another example of adverse trends facing the sector and more of this are likely to emerge as the crisis in the US and the rest of the world worsens in the coming years

The recent pronouncement by US Pres. Barack Obama to bring outsourcing jobs back to the US highlights the dangers of relying on business process outsourcing (BPO), and on foreign economies in general, for Filipino jobs. According to research group IBON, even if it is still unclear if Pres. Obama’s proposed “insourcing” legislation will pass, the vulnerability of the sector and the government’s misplaced attention to this is increasingly apparent.

MANILA—Nullifying earlier reports of declining OFW remittances, latest data from the Bangko Sentral ng Pilipinas showed remittances from overseas Filipino workers coursed through banks grew by a double-digit rate for the first time in August.

The BSP said that remittances reached $1.7 billion in August, or a year-on-year expansion of 11 percent, Bangko Sentral ng Pilipinas Governor Amando M. Tetangco Jr. announced.

For the first eight months of the year, cumulative remittances rose by almost 7 percent to $13 billion, with remittances from land-based and sea-based workers growing by 5 percent and 14.4 percent, respectively.

MANILA -- The proposal to amend the economic provisions of the Constitution to lessen restrictions for foreign investments shows that lawmakers still insist on an economic strategy that has clearly failed to develop the economy.

The newest push for Charter change (Cha-cha) supposedly seeks to revise the 1987 Constitution to give way for economic liberalization and attract more foreign investments. However according to research group IBON, foreign direct investment (FDI) has already been pouring into the Philippines over the last decades but with little to show in terms of overall economic development. This is because the fixation on attracting foreign investment has led to foregoing any long-term gains for the domestic economy.

The Ramos, Estrada and Arroyo administrations have given liberal privileges and generous incentives to FDI over the last two decades. The net result is that foreign investors have been able to make their profits but the supposed gains for economy and the people in terms of jobs, poverty reduction, industrialization and an advanced economy have not materialized.

In fact, increasing FDI has actually been accompanied by increasing unemployment, increasing labor export, falling real wages, shrinking domestic manufacturing and more volatile growth. The share of manufacturing in the economy has been steadily falling and, at 22.2% of gross domestic product (GDP) and 8.3% of employment in 2010, is already as small as in the 1950s or over half a century ago. There have also not been any real increases in domestic capital formation or in government revenues which have increasingly relied on regressive taxes on personal consumption.

The cumulative stock of FDI has increased twenty-seven-fold from US$914 million in 1980 to US$24.9 billion in 2010, increasing as a percentage of GDP from 2.8% to 13.2% over that same period. Annual inward FDI flows, in turn, increased from US$114 million in 1980 to US$1.71 billion in 2010. As a percentage of gross fixed capital formation, these flows rose from 1.3% in 1980 to a peak of 17.7% in 2006 before dropping to 8.3% in 2009 and further to 5.8% in 2010.

Foreign investments should supposedly help in building a strong productive economic base. However there is nothing to indicate that FDI has contributed to creating a strong domestic economy able to create jobs on a sustainable basis.

Changing the charter out of a fixation to attract foreign investment fails to learn lessons from the past and is going to be a step backward for Philippine development, IBON said.

MANILA—As national statisticians and development planners reported the current decline of the country’s gross domestic product for the second quarter this year, the number of overseas Filipinos’ remittances  showed that the money sent back home is declining.

According to the inflow of compensation income, an item under Net Primary Income (NPI), that is part of the system of national accounts yielded year-on-year negative growth rates in compensation income for the first two quarters of the year.

SINGAPORE -- Experts from APEC economies urged members to identify and implement structural reforms to boost trade and prosperity across the Asia-Pacific region.

APEC Residential Training Workshop on Structural Reform participants will work with fellow policy-makers from 19 APEC economies over three days to identify domestic reform priorities and capacity building needs.

Workshop participants will analyse questions of prioritizing and sequencing reforms, as well as examining structural adjustment, regulation and competition.

MANILA -- President Benigno “Noynoy” Aquino is set to witness the signing of the Millennium Challenge Account (MCA) during his US visit, but research group IBON warns that the agreement is biased against national interest and gives way for more erroneous policies that have eroded the local economy.

Contrary to the Aquino government’s target of expanding the coverage of healthcare for all, the proposed national budget for 2011 has allotted a decreased budget for public hospitals and subsidy for indigents, according to research group IBON.

MANILA (Sept 22) -- The national government’s budget deficit of an alarming P210 billion for January to August 2009 underscores the dangers of government’s unprecedented spending for debt service and dependence on debt, according to research group IBON, an independent development institution established in 1978 that provides research, education, publications, information work and advocacy support on socioeconomic issues.

SINGAPORE (Aug. 9) – “For the poor and particularly for women of our region, there are some tough times ahead,” Dr. Noleen Heyzer, United Nations Under-Secretary-General and Executive Secretary of the UN Economic and Social Commission for the Asia-Pacific (ESCAP) cautioned a largely female audience at the APEC Women Leaders Network on Wednesday, Aug. 5.

MANILA (July 21) -- The Philippines recorded a budget shortfall of P30.2 billion in June, bringing the first-half deficit to P153.4 billion, lower than targeted deficit of P155.1 billion, Finance Secretary Margarito Teves said.

SINGAPORE (July 18) --  A survey among the APEC economies has shown that 10 out of 18 surveyed APEC economies expect that the trade financing situation should ease over the next six months.  Nevertheless, the situation still bears watching given continued uncertainty in credit conditions.

SINGAPORE (July 17) -- With energy security and climate change emerging as two very real challenges to economic growth, Japan has contributed JPY 120,000,000 (approximately USD 1.3 million) to promote energy efficiency activities throughout the APEC region.

According to the Japanese Senior APEC Official, Makoto Shiotoa, “This sum is specifically directed toward the development and implementation of energy efficiency policies, goals and action plans in APEC economies.”

SINGAPORE (July 15) – “The Philippines is coping well in the existing global economic crisis and has made significant economic progress.” So says the report of external analysts, documenting progress of the Philippines toward APEC’s Bogor Goals.

MANILA (June 16) -- Two yen loans and one grant aid project worth Y44.91 billion (approximately P21.70 billion) and Y1.013 billion (approximately P488.94 million), respectively, will be signed during the official visit of President Gloria Macapagal Arroyo to Japan from 17-20 June, the Department of Foreign Affairs has announced.

The yen loan projects are the Agricultural Credit Support Project (ACSP) and the Logistics Infrastructure Development Project (LIDP) while the grant aid project involves the Project for Flood Disaster Mitigation in Camiguin Island.

MANILA (June 12) -- The Philippines has started to enter into what is effectively a recession since last year, according to research group IBON Foundation. This is considering not just the steeply dropping growth rates but also the rising joblessness and poverty in the country.

NEW YORK (June 7) -- An alternative Summit, in lieu of the United Nations Conference on the World Economic and Financial Crisis and its Impact on Development which was postponed from June 1-3 to June 24-26, was organized by a grassroots network known as the Bail-out the People Movement (BOPM).

BRUNEI DARUSSALAMs (May 15) -- Key business leaders of the Asia-Pacific region have urged the Leaders of the 21 member economies of APEC to take action to promote the recovery of world trade – expected to decline by 9 percent this year – which they see as vital in overcoming the global economic crisis.

PARIS (Xinhua) -- The head of the International Monetary Fund (IMF), Dominique Strauss-Kahn, said on Friday the world economy may need more stimulus in 2010, and governments should be prepared to do more.

Governments should "make sure that if needed more can be done in the course of 2010," he said at a news conference in Paris.

MANILA (March 27) -- Press Secretary Cerge Remonde said this morning that the Philippines is now being recognized as one of the best performing economies of Asia because of President Arroyo’s economic and fiscal policies.

In an interview with Radyo ng Bayan, Remonde cited Business World’s report showing that “the peso has outperformed most emerging market currency so far this year and is likely to prove a strong value in 2009 as the Philippine economy is least vulnerable to the factors of hammering markets elsewhere.”

MANILA (March 13) -- As a result of a worldwide economic meltdown, it erased an astounding US$50 trillion off the value of financial assets in 2008.  This includes $9.6 trillion of losses in developing Asia alone, the Asian Development Bank said.