Bernardo M. Villegas
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Prophet of Boom (Part 1)

Over more than fifty years of helping business, government and civil society foresee the future state of the Philippine economy and its various sectors and regions, I have acquired the monicker “Prophet of Boom.”  I have always warned those who want to fathom the future of events that “to predict is difficult, especially about the future.”  I tell them that I do not predict, I forecast.  The difference can be explained by the tools of statistics that enable one to use data of the past to determine certain discernable trends into the future, always assuming there is always some continuity from past and present into the future, no matter how much uncertainty there is.  Many times, I remind my audience about the Tagalog adage, “Ang hindi marunong lumingon sa pinanggalingan ay hindi makakarating sa paroroonan,” or its English equivalent, the words of Historian George Santayana, “Those who do not learn from the past are doomed to repeat its mistakes.”  Nature ordinarily does not take a jump.  This also applies to the economy.

While applying the tools of statistics (especially those of econometrics) to economic forecasting, I always add a dose of optimism.  I always try to see that the “glass is half filled” instead of being overly obsessed that it is “half empty.”  This explains why I always see that there is a “light at the end of a dark tunnel.”  This mindset enables me to see that nothing is totally hopeless, no matter how bad a situation may be.  This deep-seated attitude of mine proceeds from my being a Christian.  A follower of Christ must be convinced that everything in this world works unto good.  He believes that God, who is a good Father, will never allow anything to hurt us, his children.  Even those we call disasters, tribulations, sufferings, and mishaps—because they are permitted by God our Father—will bring some good to us sooner or later.  This is what is called Divine Providence.  The relation we have with God is called Divine Filiation, the foundation of the spirituality of Opus Dei which I try to live.

Some will object by pointing out that this life is a “valley of tears,” as we recite in a prayer to the Blessed Virgin entitled “Hail Holy Queen.”  They are partially correct because Christ Himself said that if we are to be his disciples, we must take up our Cross and follow Him.  The “valley of tears” refers to the crosses that come to our lives, some whether we like or not and others we willingly impose on ourselves as voluntary sacrifices.  But if we are truly Christ-centered, we will embrace these voluntary or involuntary sufferings with joy.  I learned an aspiration from St. Josemaria Escriva, Founder of Opus Dei, which says in Latin: “Nulla die sine cruce, in Laetitia” which means “not a day without a Cross, in joy.”  By living faithfully, the teachings of Christ, we learn how to embrace the crosses of our daily lives cheerfully.  St. Peter clearly states in his first Epistle (4, 12 – 14):  Beloved, do not be startled at the trial by fire that is taking place among you to prove you, as if something strange were happening to you; but rejoice, in so far as you are partakers of the sufferings of Christ, that you may rejoice with exultation in the revelation of his glory.”

            A realistic look at our lives, however, will reveal that there is another side to our lives. God, as a good Father, allows us also to already have a foretaste of heaven in this world, not only in the legitimate joys that we derive from the goods of this world (food, drink, health, sports, entertainment, etc.) but especially in the loves we give and receive to the people who are close to us, relatives and friends.  An objective assessment of our daily existence will reveal to us that we are not living exclusively in a “valley of tears.”  We are also frolicking happily in a “valley of lilies.”   Because I have been a “plantito” since my childhood, I especially like metaphors that talk about gardens, flowers, roses, lilies.  That is why I am especially gladdened by what I read in the beautiful verses we can find in the Song of Solomon, 6:2, 2:16: “My beloved has gone down to his garden to the beds of spice, to graze in the garden and to gather the Lilies…My beloved is mine and I am his, he grazes among the Lilies.”  The “valley of tears” as contrasted with the “valley of Lilies” is another way of expressing the that the glass is both half-empty and half-filled. 

            When I take a positive view of the economic future at any given time in our history, I am not just whistling in the dark.  I am taking my long years of economic forecasting into account.  I can truly say that I have never been wrong in assuming that there is always an economic dawn after the dark night of a recession or even depression.  I still remember the incredulous look on the face of then President Cory Aquino when I gave her a private briefing immediately after the EDSA revolution.  I told her that despite the economic mess in which the former Government left the Philippines in 1986 (we were bankrupt, our international reserves were negative, the Philippine GDP was dropping at 8 percent, inflation was reaching 50 percent), the resilience of the Filipino people supported by the private business sector and civil society will lead to a recovery in no time at all. 

            True enough, by 1988, the GDP began to grow at an average of 4 to 5 percent in the coming ten years so that when another big economic crisis (the East Asian financial crisis of 1997) hit the entire region, the Philippine economy was the least adversely affected.  While Thailand, Indonesia, South Korea and even far-away Brazil were registering huge declines in GDP at 6 to 8 percent, the Philippine economy had a slight decrease of less than 1 percent.  My positive outlook was further reinforced by the events of the Great Recession that was precipitated by the collapse of Lehman Brothers in 2008.  Once again, many economies all over the world suffered from large declines in their GDP.  The Philippines even managed to grow at a slight 1 percent in 2009.  Almost immediately, because of better management of the Philippine economy during the Administration of President Noynoy Aquino, sustained in the first years of the Duterte Administration, the Philippine economy attained an average of 6 to 7 percent annual growth of GDP from 2011 to 2019

            All these were happening despite the many failings of Philippine society such as ranking very low in practically all global measures such as the ease of doing business, global competitiveness, the rule of law, environmental sustainability, preparedness for natural calamities, quality of basic education and attractiveness to Foreign Direct Investments.  These weaknesses have been more than countered by the strengths of Philippine society such as having a young, growing and English-speaking population, a pool of highly creative talents, highly developed soft skills in such occupations as nursing, caregiving and the hospitality industry, and rich natural resources, especially in mining and tourism. 

            In addition to these natural endowments, I have also discerned success in institution building that is the key to sustainable growth.  I have seen some of the brightest and most competent professionals being appointed to key positions in the management of the economy such as the Central Bank, the Department of Finance, the Department of Trade and Industry, the National Economic and Development Authority and the Department of Public Works and Highways. Over the last twenty years or so, this institution building process under the guidance of competent and politically independent professionals have helped in maintaining fiscal discipline resulting in low debt-to-GDP ratios averaging 30 to 40 percent and in manageable fiscal deficits of 3 to 4 percent of GDP.  Inflation has also been kept at low levels of 2 to 3 percent on the average.  Tax reforms, such as the CREATE bill during the present Administration, have improved government revenues that have made possible the increase in infrastructure spending to go from 2 percent of GDP to 5 to 6 percent.  To be continued.