President Ferdinand Marcos Jr Faces Economic Challenges in the Philippines
President Ferdinand Marcos Jr of the Philippines is grappling with economic headwinds as he enters his second year in office. Despite his initial promise of rapid economic development and food self-sufficiency, the President is facing challenges such as food inflation, an energy crisis, and the impact of artificial intelligence (AI) on the country’s key growth sectors.
One of the major concerns for President Marcos Jr is food inflation, which remains high and affects the poorest Filipinos the most. Despite his commitment to ensuring food security, the Philippines has become the world’s largest importer of rice this year. The rising global prices of rice, combined with climate change and protectionist policies by food-exporting nations, have put a strain on the government’s efforts to cap the price of rice.
In addition to food inflation, the Philippines is also facing a looming energy crisis. The depletion of the country’s main local energy source, the Malampaya gas field, is expected to happen before the end of President Marcos Jr’s term. Efforts to tap into alternative energy sources have been hindered by maritime disputes in the South China Sea, where China has blocked Manila’s energy exploration efforts.
Moreover, the Fourth Industrial Revolution and the advent of AI pose a threat to the country’s key growth sectors, particularly the business process outsourcing (BPO) industry. According to the Asian Development Bank, AI could displace nearly a quarter of workers in the BPO industry in the Philippines by 2030. This, coupled with the possibility of full automation affecting a significant number of jobs in Southeast Asia, including the Philippines, calls for a proactive national economic strategy.
In his first year in office, President Marcos Jr demonstrated a distinct style of politics by shunning polarizing rhetoric and appointing world-class technocrats to his administration. He also engaged in aggressive commercial diplomacy, leading to significant investment pledges and high economic growth. However, sustaining this momentum requires the President to address the economic challenges the country currently faces.
To mitigate the impact of external shocks and tap into new opportunities brought by next-generation technologies, President Marcos Jr must adopt a proactive national economic strategy. This includes insulating the country from food inflation, diversifying the energy sources, and preparing the workforce for the changing demands of AI. Additionally, the President needs to focus on improving the country’s infrastructure, cutting red tape and corruption, and attracting high-quality investments.
While the road ahead may be challenging, President Marcos Jr’s proactive approach and commitment to economic development offer hope for the Philippines. By addressing the economic headwinds and embracing new opportunities, the President can lead the country towards a more prosperous future.
