After nine months of living in lockdown, Filipinos have experienced all kinds of hardships that have significantly impacted their lives.
The Philippine government’s imposition of a lockdown in mid-March led to severe economic repercussions as many businesses were forced to shut down, resulting in massive unemployment. Ultimately, the Philippine economy entered a technical recession in the second quarter, contracting by a record-low of 16.9%. On top of these, strong typhoons ravaged different parts of the country. All in, the International Monetary Fund (IMF) predicts the Philippine economy to fall by an average of 8.3% this year.
Perhaps one bright spot is the string of quiet achievements undertaken by the private sector to mitigate the impact of the pandemic despite their business losses. Private companies extended unsolicited and collective assistance, which eased the pressure on the government. Conglomerates poured resources to build quarantine and healthcare facilities, manufacturers repurposed their factories to produce food or medical supplies, and private groups shared their time and resources to provide food and other needs for frontliners and other vulnerable groups. Now, the private sector is actively partaking in the acquisition of COVID-19 vaccines for Filipinos.
As manifested in their efforts in cushioning the socioeconomic impacts of this crisis, businesses proved that they can be strong drivers of economic recovery post-pandemic.
A Pulse Asia survey revealed that 85% of Filipinos agree that to recover from the COVID-19 crisis, the government should partner with private enterprises, especially in building and operating key development public utilities and social service projects such as healthcare systems, electricity, water, roads, and mass transport. The survey also found that the top issues that private investors can help address are job creation, expansion of livelihood opportunities, and poverty alleviation.
During the virtual Pilipinas Conference 2020 organized by the Stratbase ADR Institute last November, the speakers resonated with the same message. Ayala Corp. Chairman and CEO Jaime Augusto Zobel de Ayala said that the investment-led component of the Philippines’ economic equation must be pushed to jumpstart the economy, create more jobs, and begin our recovery.
The second point emphasized in the conference is urgency to build up our digital infrastructure to support economic recovery.
Mr. Zobel, whose companies under the Ayala Group are involved in laying out the country’s digital infrastructures, elaborated that customers are more focused on keeping themselves safe and accessing services and products in completely different ways. The pandemic left everyone with no choice but to shift to digitalization, and, with this, “transformation just moved up to a whole other degree.”
Fortunately, local internet service has become faster now due in part to the government’s initiatives in cutting red tape, according to the National Telecommunications Commission (NTC). But telcos Smart and Globe also deserve credit for aggressively accelerating their infrastructure spending to expand and upgrade services.
Recently, an Ookla report showing that internet speeds are now faster by 100% compared to past years. OpenSignal, an independent mobile analytics firm, also reported significant improvements in the experience of Philippine subscribers in its latest Mobile Network Experience Report. The report showed that the country’s average data download speeds have improved by 80.9% from 4.7 Mbps to 8.5 Mbps since 2018. It also showed that 4G availability is on the rise, with Globe Telecom’s coverage, for instance, increasing by 19.5 percentage points from 63.7% to 83.3% over the last 10 consecutive quarters.
All this has led to Presidential Spokesperson Harry Roque even thanking the telcos for their efforts during a recent public briefing. This just demonstrates how responsive policy is good policy and that it stimulates investments and tangible improvements on the ground.
There is a strong need to uphold the whole-of-society approach with all sectors working together towards a common goal, which is “shared prosperity” for collective and sustainable recovery, as Mr. Zobel emphasized. For the whole system to jumpstart again, there must be collective action.
He also stressed the need to take care of the ecosystem around us if we want this ecosystem to succeed. “We cannot succeed if the rest cannot succeed as well,” Mr. Zobel concluded.
Rizalina Mantaring of the Management Association of the Philippines (MAP) said, “If the community around you suffers, you will not be sustainable.” Amb. Benedicto Yujuico, president of the Philippine Chamber of Commerce and Industry (PCCI), emphasized the need for the bayanihan spirit in developing recovery strategies to heal as one.
Indeed, it is time for companies to embrace the concept of “stakeholder capitalism” over the orthodox “shareholder capitalism.” Enterprises must consider the interests of their stakeholders — from their suppliers to customers — in their long-term vision and plans, and not just the interests of their shareholders.
The government cannot bear the weight of this pandemic alone. With public resources strained by the pandemic and natural disasters, the support of the private sector is critical in re-energizing and sustaining the country’s economic recovery. Through collaboration between the government and the private sector, this crisis can be an opportunity towards change that is positive, inclusive, and sustainable.
One lesson from our recent challenges is the importance of collaboration for relief and recovery. Without the business community, the government might not have been able to address this predicament quickly. Indeed, uniting both the government and the private sector is crucial in countering the ongoing crisis and in paving the way for economic recovery and sustained growth.
Victor Andres “Dindo” C. Manhit is the President of the Stratbase ADR Institute.