Speech
of
His Excellency Fidel V. Ramos
President of the Philippines
Before the Oxford Union Society during the working visit to the United Kingdom of Great Britain and Northern Ireland
[Delivered at the Old Library Oxford Union Building, Oxford, England, June 17, 1997]
The Philippines
in the global order
YOUR INVITATION to address this body is an honor I was very pleased to accept. Any individual with the slightest pretensions to intellectual ability would be delighted to bask—however briefly—in the scholarly shade of this debating society which has flourished for 800 years.
Your invitation is a distinction I believe you bestowed not only on myself but on the Filipino people—whose travails the world has watched closely since our peaceful People Power Revolution of February 1986 during which our people overthrew a dictatorial regime.
So I shall speak here for Filipinos. I have no grand design to outline—no earthshaking political or economic theory to propose. I have only the story of the struggles of my country over the past two decades to relate.
Let me share with you, then, the Philippine experience and its relevance to the emerging global order.
Over the 1980s and the early 1990s, the Philippines was considered “the sick man of Asia”—a demoralized country ruled by a strongman and his cronies, who controlled all the levers of political and economic power.
Then plagued by lawlessness, corruption and mass poverty, the country moved inexorably toward the brink—until the assassination in August 1983 of the opposition leader, Senator Benigno “Ninoy” Aquino, turned our people’s despair into burning anger.
The People Power Resolution of 1986
A great wave of spontaneous protest movements nationwide climaxed in the People Power Revolution of February 1986 when ordinary Filipinos confronted the regime’s tanks and artillery—a great wave which also sent ripples of freedom throughout East Asia and Eastern Europe, and then to Latin America.
The task of restoring democracy fell on Ninoy Aquino’s courageous widow, Corazon C. Aquino. This task consumed the whole of her six-year term as President from 1986 to 1992—because the treasury was empty; there was a massive electric power shortage; political institutions had been gutted; and the Philippine State was besieged simultaneously by a communist insurgency, Muslim separatism and mutinous young officers of the Armed Forces and the national police.
But President Corazon Aquino was steadfast. Her government tenaciously defended our civil liberties and the countryside against the rebels’ repeated assaults. So that, when I succeeded her in June 1992, I could think about longer-term national reconciliation, and restoring the economy to the path of growth.
Even before I took my oath of office as President, I was reaching out to the political factions and to all the armed dissidents. The political factions I grouped into a rainbow coalition in Congress. To the communist insurgents, military rebels and Muslim separatists I offered honorable peace and a participative role in government.
Congress concurred readily with my proclamation of amnesty for all the armed rebels. On my recommendation, it also repealed a Cold War law that had outlawed the Communist Party of the Philippines; and then, together, we set about dismantling the 40-year-old regime of protectionism and inward-looking nationalism that had made our country a laggard among its export-oriented neighbors in the world’s fastest growing region.
Bringing together the national community
The peace process—which continues to this day—has largely succeeded. Since 1993 the military rebels have rejoined the political mainstream; their leader has been elected to the Senate. And the peace agreement we concluded in September 1996 with the Muslim separatist rebels in Mindanao finally brought together the national community after some 400 years of religious and cultural estrangement.
Our peace negotiations with the Communist leaders—who have exiled themselves in the Netherlands—are now being concluded. But many of the Communist cadres have not awaited the formal end of these protracted talks. They have made their separate peace—and reentered civil society, without hindrance, and with Government livelihood assistance.
Preparing the economy for takeoff
In this manner we built the platform for our economic takeoff, founding it on the rock of national reconciliation and political stability. Because we had mistakenly tried to protect our industries from foreign competition, we had been left behind East Asia’s growth. Over four decades we had mistakenly equated political nationalism with economic self-sufficiency.
In the early nineties we realized we had to enter the mainstream of global commerce and take part in the vigorous life of the East Asian economies. In the spirit of competition, we set about dismantling the barriers—erected over 40-45 years—against foreign investment and multinational industries.
And we began by leveling the playing field of enterprise—by dismantling the cartels and monopolies which had dominated the closed economy.
Swiftly, we deregulated not only all foreign-exchange transactions but also one key industry after another—starting with telecommunications, air, sea and land transport; banking, financial services and insurance; and the petroleum industry. We privatized inefficient public corporations or portions of them. Recently, we ventured on the “mother” of all privatization programs—by awarding franchises and long-term concessions on Metro Manila’s entire water and sewerage system that serves 12 million people to two Filipino corporations and their European and American partners.
And we put our financial house in order by instituting reforms in the tax system—while also ridding the public service of excess fat and overlapping functions
Finally, we concentrated on improving what the World Bank calls the “wheels of development”—our infrastructure—by focusing public funds on high-priority “flagship” projects and by innovative arrangements such as Build-Operate-Transfer schemes and their variations that enable private investors to invest in public utilities and other enterprises under joint-venture agreements.
Achieving the turnaround
As a result, our GNP grew—from 5 percent in 1995 to 6.8 percent in 1996, a respectable figure even among East Asia’s high-fliers. Our target for GNP this year is at least 7 percent and we should be hitting 8 percent by next year.
What is most encouraging to us is the economy’s steady expansion, including at the local level. From nearly zero growth when the Ramos Administration began in 1992, we have added—year after year—to national productivity. Now we are reaching the levels of growth our vigorous neighbors have known for over a decade—and where we in our turn will strive to stay.
Inflation has slowed down steadily. Over this first quarter, it was reduced to 4.7 percent—from 11.6 percent over the same period last year. Interest rates too are falling and the exchange rate has remained remarkably stable—with fluctuations in the Philippine peso-U.S. dollar rate hovering within a band of one-half of one percent—making our national currency one of the steadiest in the world.
At a time when exports are declining in other East Asian countries, our own exports continue to grow—by 18 percent in 1996, and foreign investment inflows reached P490 billion in 1996—six times larger than the surplus in 1995. And our gross international reserves hit a record $12 billion at the end of 1996.
These indicators signify not just incremental changes but a qualitative transformation of the economy and of our brighter prospects for the future. In their totality, they tell us the Philippines is no longer trapped in its old cycle of boom and bust.
Giving ordinary people a stake in development
Growth in a free-market economy is initially lopsided—in favor of the better-endowed provinces and administrative regions, and of its social classes best equipped to take advantage of the opportunities opened up by heightened business activity. This problem of uneven development we have alleviated to a significant degree by creating 65 “growth centers” throughout the archipelago which put together agriculture, industry, capital and skilled labor in our 16 administrative regions.
But because the Filipino poor cannot wait, we have moved poverty alleviation to the center of Government concern. Rejecting the laissez-faire “trickle-down” approach, our Social Reform Agenda has focused on the country’s 20 poorest provinces and on specific marginalized and disadvantaged social groups.
As President, I myself have seen to it that all the agencies of Government take on a bias for the poor; and that economic policy maintains a special sensitivity to the well-being of those who are without the means and the opportunity to create, by themselves, decent and productive lives.
The principal components of our Social Reform Agenda are the expansion of job and skills-training opportunities; the improvement of public housing; and the extensive delivery of basic quality education, primary health care and environmental sanitation to the people of our urban slums and rural hinterlands.
What we Filipinos have set out to do—to develop as a functioning democracy—goes against much of the grain of conventional wisdom in East Asia. The dominant view still is that democracy and economic growth cannot go together, and that an authoritarian approach is desirable because the exuberance of unrestrained democracy may lead to undisciplined and disorderly conditions harmful to development.
Age of authoritarianism is over
For the Philippines, the age of authoritarianism has passed. Instead of the discipline of command, Philippine policies and programs must increasingly invoke the self-discipline of civic responsibility.
Experience has taught us that we cannot safely dismantle—even for the briefest period—our constitutional checks and balances, because suspending these mechanisms makes public administration no more efficient, but possibly only more corrupt.
Our democracy is far from perfect, but its improvement lies in more people empowerment, not less.
Thus, we are devolving political authority from the center in Manila to local governments throughout the archipelago. We are encouraging ordinary Filipinos to use their local organizations, their cooperatives and their votes to ensure that their needs, wants and hopes are heard in the making of public policy.
Our most urgent task is to make our citizenry’s sense of civic responsibility as strong and as acute as its sense of civic entitlement, through values education and the deeper inculcation of a national spirit devoted to duty and service.
New directions in foreign policy
Let me now turn to a brief exposition of Philippine foreign policy. Our foreign policy today reflects our goals and aspirations as a democratic country. We have reoriented our diplomacy not only to promote our economic development but also to enhance our contribution to regional peace, stability and prosperity.
We have harnessed our foreign service in the drive to promote exports and tourism, attract investments, encourage technology transfer and tap new markets. And we are expanding continuously our network of friends and partners in a world more interconnected than it ever was.
Since the end of the Cold War, geoeconomics has overtaken geopolitics as the driving force behind worldwide trends. A multipolar global system is shifting the emphasis in state relations from ideology to economics.
Today no state need aspire to hegemony—because it can attain its goals through peaceful commerce and integration in the community of nations.
A truly global market has risen, which is founded not on force but on mutual benefit—not on monopolistic control but on broad participation.
Driven by the logic of their market systems, more and more countries are moving toward political openness and pluralism. Representative systems have become more institutionalized in Eastern Europe, in the former Soviet Union and in Latin America.
Perhaps the most important effect of economic interdependence has been on peace and mutual security. Deepening dependence on external markets makes it imperative for countries to maintain friendly relations with their neighbors.
This is true most of all in places of high growth.
A major explosion of violence anywhere in East Asia, for instance, will surely burst the bubble of stability that keeps its economic miracle going.
Growth poles across political borders
Never in our part of the world has intraregional trade been so buoyant. Growth poles that integrate natural economic territories (the so-called NETS) across political borders have risen from Northeast Asia down to Southeast Asia and across the Pacific—radiating circles of intense economic activity, raising incomes dramatically and providing the impetus for an emergent Asia-Pacific community.
The 1996 World Bank Atlas reports that Asia’s share of global output had jumped from only 4 percent in 1960 to 27 percent in 1994. And the International Monetary Fund estimated that developing countries in Asia—over the 10 years between 1985 and 1994—increased their exports by an average of 14 percent yearly. And fully half of these went to other East Asian countries.
In our time—the world over, in fact—market reforms, deregulation, privatization, technology transfer and capital inflows must be the watchwords for those economies that wish to catch up with the tiger economies of East Asia.
ASEAN as the core of one Southeast Asia
The integration of the 10 Southeast Asian states has been a 30-year dream of ASEAN’S founding fathers—as a safeguard against the political and economic uncertainties of the future world. This process is likely to be completed this year.
Integration into one community will prevent Southeast Asia from ever again becoming a cockpit for the strategic competition of the great powers. It also increases Southeast Asia’s attractiveness to foreign investors, and enables its individual member-states to plug their economies into the global grid of commerce, information, technology and science.
A unified ASEAN will also exert a moderating political influence on Asia-Pacific affairs.
Some countries may object to ASEAN’s incorporation of Myanmar, but to us of ASEAN, that Myanmar is part of the Southeast Asian family is reason enough to bring it into the fold.
We are confident that membership in ASEAN will have an ameliorating effect on Myanmar’s economy and society, and will gradually draw the Yangon regime into the international community with greater certainty—while its continued isolation will not achieve the results that we all want.
ASEAN has also made itself the hub of proactive and preventive diplomacy in the Asia-Pacific.
Its ASEAN Regional Forum is the principal venue where ASEAN and its dialogue partners can, as a group, conduct regular consultations on regional security and undertake activities that build confidence among one another. On the other hand, the Asia-Pacific Economic Cooperation (APEC) forum has adopted ASEAN’s negotiating methods of consultation and consensus in order to liberalize trade and facilitate investment.
One of our principal concerns at the moment is that complex disputes arising from overlapping exclusive economic zones and conflicting claims to portions of the islands of the South China Sea could—by design or miscalculation—flare up into open hostilities.
Using economics to outflank politics
Such a conflict would disrupt the strategic sea-lanes through which the bulk of East Asian trade passes. Further conflict would impact on the basic interests of the global community, which has a vital stake in East Asia’s continued economic growth, and in the freedom of navigation through Asian waters.
I have proposed the demilitarization of the South China Sea islets claimed by six littoral states and the cooperative exploration and development of their resources based on the stewardship principle through joint mutually beneficial arrangements.
Within ASEAN, governments have consistently used the market system to speed up political cooperation—initially through cross-border “growth triangles or polygons” and now through an ASEAN Free-Trade Area, which will be fully established among the six older members by the year 2003.
The same strategy—which Deng Xiaoping called “using economics to outflank politics”—can work in the larger Asia-Pacific region by promoting economic interdependence conducive to greater political openness.
The Asia-Europe Meetings: Philippine initiatives
The Asia-Europe Meeting (ASEM), started in Bangkok in March 1996, completes the linkages among the three main poles of global economic power—North America, Europe and East Asia.
The first Asia-Europe Meeting—or ASEM—I for short—gathered the heads of government of ASEAN, China, Japan and the Republic of Korea and the European Union in a historic assembly that encouraged all adherents to advance not only their economic partnership but their shared goal of world peace as well.
ASEM gave the Philippines the opportunity to contribute to closer Asia-Europe cooperation. Citing our own national policies and experience, I suggested that people’s needs and welfare must be the overriding consideration in all our cooperative endeavors, which must be reinforced by expanded people-to-people exchanges and through prioritization of small and medium enterprises.
I called for people-to-people engagements among the youth, students, women, farmers, small entrepreneurs, business chambers, people’s organizations, think tanks, universities and other institutions of learning. Our people-centered approach to national development led me to advocate the development of human resources—through education, training, health, housing, environmental protection and so on—as the primary focus of international cooperation.
I placed special emphasis on small and medium enterprises since they most need the encouragement and help that the governments can give. I offered our APEC Center for Technology Exchange and Training for Small and Medium Enterprises located in the Philippines, for Europeans to participate in, and invited the leaders’ attention to the new Asia-Europe Management Center that is being set up at the Asian Institute of Management in Metro Manila.
The United Kingdom will host the ASEM in April 1998. Beyond the ceremonies of gatherings of this nature, the sense of community that grows out of the personal contacts among world leaders should influence favorably the political, economic and cultural relations between our two poles of the global triangle of economic wealth.
Toward a multipolar world
The breakdown of the bipolar world has created a void that has inevitably been filled by regional powers. In some ways, the old bipolar world was simpler, the rules less intricate. Today the lines are not so clearly drawn.
But in East Asia’s experience, we can discern the glimmerings of a new future. The picture that emerges is one of increasing economic engagement and interdependence—a homogenization of politics—and a nascent sense of community.
And all these enable us to hope that the time will soon come when Asian countries, too, will enter the zones of peace that the European Union and North America inhabit.
While we do not offer our experience as a model for all developing countries, there are aspects of the Philippine story, as a unique component of Asia’s larger development, which are relevant to the emerging new global order. Let me sum up thus:
First, pluralistic societies should be encouraged, because nations that tolerate dissent become more resilient.
Second, there are no secret recipes or instant fixes for success. A society willing to learn from its past and to experiment with what works and what does not, stands a better chance of succeeding than one that closes in on itself.
Third, material prosperity is meaningless if its fruits are not shared by the vast majority of the people. Only by receiving their rightful share of social benefits and material wealth do people become aware of their stake in their country’s development. The same holds true for nations. A more even sharing of global riches and the benefits of globalization gives national societies a greater stake in world peace and stability.
Finally, in an increasingly complex global environment, small and medium states—by acting in concert with like-minded countries—can become a force for peace, moderation, restraint and fair-mindedness in the global community.
These are valuable lessons that we of the Philippines now offer to the world.