Speech
of
His Excellency Fidel V. Ramos
President of the Philippines
At the Export Development Council Meeting

[Delivered at Malacañang, Manila, February 14, 1995]

Philippine exports:
on to the high seas

AFTER ALL has been said and done today, I am beginning to believe that Sergio Ortiz-Luis Jr.’s pet, this “house lizard” in a community of economic dragons, has indeed begun to grow into a young dragon, not the crocodile we discussed at the September 1993 economic summit.

Leaving the harbor

If my reading of the situation that Trade Secretary Rizalino Navarro glowingly pictured before us is correct, our Philippine export ship indeed has left the harbor. It is now on the high seas, ready to advance in the face of storms, and prepared to haul in $15 billion by October 1995.

Coming from the ship captain of the Export Development Council, this prediction would make Secretary Navarro’s targets doable—and I hold him responsible for delivering on this prediction. But I have good reason for my faith. After all, he and our allies in the export community delivered last year.

Before my term ends, I trust that we will be earning more dollars from our exports than we pay for our imports. A trade surplus, not an $8-billion trade deficit, should be the best indicator that we are on course toward becoming a newly industrializing country by the year 2000.

This morning’s induction of top leaders of our export and domestic industries into the select Export Development Council, and the accreditation of Philexport as the Council’s “first mate” in our export vessel, are the finishing touches in our effort to ensure our economic flagship’s seaworthiness.

The Export Development Act

I am upbeat about our Export Development Act. This fulfills a commitment that the Ramos Government has made to the private sector.

As the new century approaches, many Filipinos have become aware of the realities we face in the international arena.

We now know that we cannot afford to stay out of the new world trading arrangements. The cost would be the kind of crippling isolation and stagnation that has kept our Philippine ship idle in port all these years.

Our only answer is: to venture out as boldly as we can—to expand beyond our shores and our traditional markets.

For our export crew, quality products and quality service will be the key. This means seeking continuous improvement in the quality of our merchandise, and greater efficiency and fidelity in fulfilling commitments to prospective buyers.

A balanced strategy

We are committed to the principle of a market-led foreign-exchange regime. But we must also continue to take steps toward ensuring that the foreign-exchange environment is realistic in terms of consumer interests and reasonably competitive in terms of the interests of exporters.

This balanced strategy should ensure that our ship remains on an even keel while sailing forward even in rough seas.

I have just signed three orders related to the moderation of a fluctuating exchange rate under a ”floating rate” policy. This is the first step in a calibrated program to keep our export products more competitive without hurting a major segment of the economy who are ordinary consumers.

Fiscal management

This must also be accompanied by sound fiscal management. Budget Secretary Salvador Enriquez Jr. and Finance Secretary Roberto de Ocampo have demonstrated their determination to keep our public spending prudent without sacrificing the need to build or upgrade roads, power plants, ports and airports, telecommunication networks and irrigation systems, and providing health care and education to our people.

After repeatedly incurring huge deficits in the past, we registered a budget surplus last year. We are determined to keep it that way for the rest of my term and beyond.

I realize that if Government keeps on borrowing from the banks through Treasury bills, we will be denying private enterprise access to the capital which could be more profitably used to create new businesses and expand existing ones.

I also have no intention of driving interest rates back up to levels that could stop businessmen from borrowing from the banks to expand their operations.

A commitment to democracy

I have said it before, and I say it again: The Ramos Administration is 100 percent behind an aggressive export drive as our best means of moving forward competitively.

I must impress upon you, however, that this policy must be guided by our commitment to a democratic philosophy of economic growth with social justice.

Having pledged myself to a free-market system under our uniquely Philippine democracy, I have always chosen consultation and consensus-building before making crucial decisions. I will not abandon that process now.

But once a decision is made—such as when I set out, at the beginning of my term, to dismantle cartels and monopolies—we must be firm in our resolve to stay on course, no matter how rough the sailing may be.

We have taken such steps precisely to improve the climate for business in our country, and to prepare us better for the future. Our economic programs and social reform agenda cannot be delinked one from the other.

We seek growth, yes, but growth with equity, growth that will have beneficial effects for the masses of our people.

With the Export Development Act, we have laid down the foundations for the emergence of a new democratic elite, the exporters. We have done so in the hope that we are not creating, in our midst, a new aristocracy to replace the old ones.

This Government will continue to support enlightened entrepreneurs, sensitive to the needs of our poorer countrymen, and willing to share the wealth businessmen will accumulate.

Our social reform agenda

That sharing is far from being an automatic process.

Our social reform agenda, launched toward the end of last year, is premised on the practical consideration that sustainable economic growth, a surge in exports and the GNP, and the nursing of local industries into internationally competitive corporations do not automatically result in the conquest of poverty.

I do not believe in the “trickle-down” formula as the best approach to the sharing of increased national wealth. Sharing has to be programmed and focused in the same way that irrigation water has to be so channeled so that all farms, whether close to or far away from the main irrigation canal, get enough water to nourish their plants.

Money or wealth is like irrigation or potable water: It flows only to areas where access is built-in through canals or pipelines.

My Administration is putting these pipelines in place. We need to ensure that the wealth of this nation is not stored in a dam reserved for the use of only a few haciendas and exclusive villages. To energize the countryside and increase productivity, we have to channel that wealth to those who need it most.

Distributive justice

That rechanneling I call people empowerment. Some call it “distributive justice.” But whatever be the label, it is the best deterrent to political instability, the best insurance against insurgency, and the best binder for our social cohesion. It is the right and the just response to conditions which, if unmitigated, could lead to renewed dissidence and increased criminality.

Let me take this occasion, then, to invite all of you to come on board and join the second phase of my Administration’s economic growth program.

Our social reform agenda, combined with my Government’s solid commitment to export development, should see us through to genuine and sustainable progress.

Exports must mean more than selling products abroad and earning dollars in the process. Every item we sell, every deal we transact, every trade mission we undertake, must mean another chance at a better life for all our countrymen.

Like the great explorers of old, those of you in the export sector have this rare privilege and opportunity to lead us into a voyage of discovery and conquest—not only for one’s own fame and fortune, but for the good of the nation as a whole.