Posted by: luvin | March 11, 2015

Economic Good, Economic Growth


The Good news; Philippine attracted more investment. from 3 billion dollars to 6 billion dollars. This would mean more jobs, more products, and more money to the rich pinoys.

The Bad news; poverty has increase. from 23% to 25%. it means there is no inclusive growth. The poor is not benefiting from economic growth.

This year the economy is expected to grow by 6.2% and since the country have been on around 7% growth since the Arroyo administration, the poor Filipinos should already start to enjoy the growth. (Economic planners are saying we need seven years of continued growth of about 7% per year to really have an impact on the economy. )

Given, however, the present governmental setup, where the central government sucks up all the revenues and allocate the juices unto themselves and favorites, the poor specially those in the provinces will have nothing left. Most of the resources, including the foreign funds, could be found in the hands of the central government. The poor don’t know a thing or existence of such funds. The poor does not know that in banks these days are financial capital waiting to be exploited.

One of the problem the hampers the used of this capital is the knowledge of how to access them. Another one is the lack of collateral which most banks requires before one would be granted a loan. Another hindrance are the paper works. Every borrower, small and big, are required to produce voluminous documents such as BIR payment records to prove once paying capability, bank statements, and such. These are papers which banks says are necessary requirement because they want to be sure that the borrower can really pay the requested loan. The new borrower, specially the poor ones don’t have enough record to show yet. They are new remember. How can an upstart have the BIR record, the bank statement?

The government have legislated some solution to this problem a way back. The solution given was for the government agency to guarantee the loan, but what happened to that law. I don’t know. It is still difficult to borrow money from the banks, and the government guarantee is nowhere to be found.

If only the the government could help make ease the access of these loans, more poor people will benefit from economic growth. If the micro entrepreneurs can have access to these huge capital, it would really transform the economic landscape of this poor country of ours. Micro entrepreneurs comprises more than 90 percent of all businesses in these country but only have about 10% impact on the economy due to their microness (smallness). These micro entrepreneurs are the poor people who already on the move upwards. These are the poor who are ready to take this country to the next level we all are waiting for. Help them. Let the bank make those exemptions. Let the angel investors come. (This could also be legislated, like making these kind of investment as expense, so it becomes tax deductibles.)

Help the poor have access to these huge capital,  allow them to make a huge participant in this economic transformation, let them be the answer.



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