Thursday, February 23, 2006

Visa-free entry and people mobility

The Philippine government allows citizens of 145 countries to enter the country visa-free for visits of 21 days or less, and citizens of a few other countries for visits of 7 days or less; 59 days or less. The list of these countries can be found in the Philippine government portal, . For visits longer than 3 weeks, a Philippine visa will be required though.

A few countries allow Filipinos to enter their country visa-free too for short visits. Among these are Singapore, Thailand, Malaysia, Indonesia, Vietnam, Laos, Cambodia, Brunei, East Timor (as fellow members of ASEAN); Hong Kong, Macau, Seychelles, Maldives, Nepal; Cuba, Netherlands Antilles, Bermuda, Haiti; Costa Rica, Nicaragua, Panama, Ecuador, Brazil, Peru, Colombia, Bolivia, El Salvador, Honduras, Suriname, Belize; Morocco, Israel; Palau, Fiji.
(Thanks to Robby G. for this list!)

One proposal made by some people is "reciprocity" in visa-free entry; ie, if the Philippine government gives visa-free entry for short visits to nationals of about 150 countries, then governments of those 150 countries should also give Filipinos visa-free entry into their lands. I don't believe in reciprocity. Just open entry of foreigners to the Philippines visa-free (again, for visits of 3 or 4 weeks or less), even if the governments of those foreigners will not grant the same privilege to Filipinos. I advocate full free trade, even unilateral trade liberalization, so I also advocate full mobility of people, even unilateral free entry and mobility of foreigners into the country -- except the known terrorists and organized criminals.

The geographical isolation of the Philippine archipelago from the rest of the world, even from its South East Asian neighbors, is already a big factor why the country is not attracting too many tourists. For instance, when you land in Vietnam, you can take a bus or train to China and Laos (north), bus or train to Cambodia (west), then further west to Thailand, Myanmar, etc. But when you land in Manila or other international airports (Cebu, Davao, Clark), we have no other neighboring countries accessible by land. It's the vast Pacific Ocean in the east, South China Sea in the west, and lots of small seas in between the islands and provinces. So, easier access through visa-free entry is one incentive to lure tourists, foreign businessmen and visitors, to come in. Although it doesn't help that Manila's international airport (NAIA 1 and 2) are just "provincial and domestic" airport in size and facilities compared to many other countries' international airports, like those in Thailand, Singapore, Malaysia, Vietnam, Korea, Japan, and so on.

Some African countries which don't give visa-free entry for Filipinos are ruled by dictators who just live off on taxpayers' blood and sweat, both local and foreign taxpayers. Even if the "visa fee" is only $10 or $20, for those dictators and bureaucrats, that's still money that can go to their pockets. Now if their rich nationals (say, families and relatives of those dictators, top bureaucrats and private cronies) would come into the Philippines to see Boracay, Davao, Cebu, Manila, Baguio, Bohol, Palawan, Puerto Galera, etc., let them come in visa-free, let them spend their money in Philippine beach and mountain resorts, in Philippine malls and restaurants, in Filipino boatmen and travel guides. (We can't bar and confiscate their money as "ill-gotten wealth" as it is an internal problem that has to be resolved in their own countries.)

The wealthy countries of W. and N. Europe, N. America, N. Asia (Japan and Korea) are too protective of their welfare system; that system is too expensive, financed by high and multiple taxes of their citizens, and continuously accummulating public debts (e.g., France's unfunded social security system is around 200% of GDP!) that they can't extend such welfare to many citizens of other countries. Hence, the strict "visa-required" rule, even for few-days visits.

The Department of Foreign Affairs (DFA) though, does not give visa-free entry yet to citizens of Russia, Kazakhstan, Croation, other central Asian and eastern European countries. I don't understand why, but it will be an important diplomatic and economic move to lift such travel restriction and allow the nationals of those countries to come in visa-free.

People by nature want to be free to move around in many places, islands and continents. Before, it was the harshness of nature and environment (very hot desert, very cold and prolonged snow, presence of many savage animals that can attack people, tribes that are averse to entry of foreigners) that prevented many people to move around. Later on, governments of many countries began expanding, and so the bureaucracy and restrictions to travel also expanded. With modern technology and increasing competition among international airlines, international hotels, international telecomms companies, communication and mobility among friends, families and clans, business and cultural partners, become easier. It is only rightful that full mobility be respected and given back to people -- except to those who inculcate hatred and violence.

Thursday, February 02, 2006

Migration and Freedom 1: World Cup, brain gain and OFWs

During the last World Cup, a small and "lowly" African country, Senegal, beat the defending world champion France in the eliminations (or quarter finals?) round. It was one of the "shocking" results of that world cup. Why? One important reason is because Senegal "exported" or "brain-drained" some of its best soccer players to play abroad, in European football clubs, especially. Then one day the boys came home to play for their national flag, and the players used the experience and talent they gained while working and playing abroad. And they beat and eliminated the reigning, the defending, world champion!

For me that's one big advantage of brain gain. And I don't believe in "brain drain". OFWs or other nationalities leaving their countries to work abroad should never be considered as brain drain. When Filipino nurses and doctors leave the hospitals they are working in the Philippines, went abroad to work in a hospital in the US or Canada or Europe or elsewhere, the health displacement is temporary. One day, some of those health professionals will come back, not as nurses or doctors, but as owners and administrators of new clinics, new hospitals, or an HMO company. The experience, talent, network and business partners, and savings they got abroad.

So I stick with my simple formulation:

Migration = Mobility = Freedom.

Whether such migration results in some broken families back home, these are some of the costs that households can decide and risk. The same way that there are costs and risks for staying in the country for many people when jobs and pay are not enough.

The OFW phenomenon has been with us for the past 30 or hundred years, though it grew noticeably larger and faster over the past 20 years, along with faster pace of globalization (more work opportunities abroad, more competing international airlines, cheaper info and communications dissemation among families, etc.).

Maybe we just don't notice it, but the new medical and nursing schools, the new clinics and private hospitals, new HMO companies, that we have NOW, are put up or managed by health OFWs who have left the country 10, 20, or 30 years ago. They may or may not be in the Philippines physically, but the resources and network are all here.

For whatever reason or alibi, government should not put up any barrier or hurdle or hindrance to migration and mobility of people, whether health professionals or rock bands or investment analysts. If people want to go abroad, let them be. People respond to incentives, and shy away from disincentives. If staying here in the country means bearing low incomes while paying high personal income taxes -- gee, the House Committee on Ways and Means (in charge of taxation), is planning to hike personal income tax from 32% to 35% for those with annual taxable income of P500,000 or more.

So government policies are not a good reference point for many individuals and households to decide to stay. While govt. says it wants to lure health professionals to stay in the country, it whacks them with double taxes -- VAT on health services (which possibly reduce their clients since medical check-ups and medicines are now subject to higher VAT), and high personal income tax. This is not to mention the other taxes and govt. fees on their household consumption, from VAT on hamburger to excise tax & VAT on fuel products. So, households weigh the costs/risks and benefits of staying in the country. And it turns out that for many households, the costs far outweigh the benefits.

If government really wants to help the poor and the sick, government should abolish income taxes (or keep a low, flat tax) and retain VAT (I'd even favor a 15% VAT if income tax is zero) as main govt. revenue source. So that if you're a doctor (or engineer or manager or...), you keep all of your incomes (no confiscation by govt.), you keep your friends and family members here, you pay tax only when you spend, better stay here. Because in the US and Canada and UK, incomes are high but income taxes are also very high.

And yes, churn out more health professionals and other skilled people in the education and formal training institutions. So what if 200,000 nurses and doctors leave every year, if you also graduate 250,000 nurses and doctors every year. This means deregulating the education, health care, and the business environment in general. Less permits and licenses, less charges and fees, less signatures and paper work, less taxes and bureaucracies, and you'll have lots of entrepreneurial initiatives.

There are policy implications for this formulation. If migration is good (since it is voluntary, not forced), then government should not get in the way over-regulating and choosing players (and disallowing many others) in the manpower recruitment agencies. Let the sector regulate themselves, like forming their own industry associations, and these associations will police their ranks who are the recognized members (ie, good recruitment agencies) and who are not. One reason why "placement fees" for potential OFWs are very high is because there are just too few "licensed" recruitment agencies. And I would presume that the licensed ones have paid huge amount of fees, legal and under-the-table, to the government overseas placement agency, the POEA, and other government agencies. This makes working abroad an expensive option.

Finally, when people wish that "all (or most) politicians would leave and be exported", unconsciously I think, people are wishing that there be "less government". Because politicians and many many bureaucrats represent taxes, charges and fees, permits and licenses, that the citizens bear. And very often, the wastes and corruption that come with the presence of too many politicians and government bureaucrats.