Fishpens, fishkill and population

I used to read a lot of stories about "fish kill" in Laguna Lake -- the biggest lake in the Philippines -- a few years ago. Today I googled the subject, no recent news, good. The latest story is about Taal Lake in Cavite, 

Presence of fishpens to blame for massive fish kill in Taal Lake – Pamalakaya

November 12, 2018, By Ellalyn de Vera-Ruiz

https://news.mb.com.ph/2018/11/12/presence-of-fishpens-to-blame-for-massive-fish-kill-in-taal-lake-pamalakaya/.

Perhaps this means that the fish farmers in Laguna Lake have improved their system so that large-scale fish kills are now avoided, or water quality in the lake has somehow improved, or these plus other factors. Meanwhile, I posted below 7 1/2 years ago.

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June 04, 2011

These are the fishpens in Laguna Lake that I took from a plane this afternoon on my way to Bacolod City to visit my sick mother. Click on the pictures to see their larger images.

Too many fishpens in the lake, just a few dozen kilometers from Metro Manila proper. And much, much more houses and structures to accommodate Metro Manila's 12 million people, which easily rises to 13-14 million daytime population on regular days as people living in the neighboring provinces of Bulacan, Pampanga, Rizal, Laguna and Cavite would troop to the big metropolis to work or study or do business.

A few days ago, there was a huge report and fish scare as a result of the big fishkill affecting bangus (milkfish) in Taal Lake, not very far from Laguna Lake. A friend from one of my discussion yahoogroups working at the Bureau of Fisheries and Aquatic Resources (BFAR) gave this brief explanation:

... natural incidence where dissolved oxygen becomes low such as night time where there is no photosynthesis. To avoid the situation such as that, we recommend the limitation of stocking density to the extent of the "carrying capacity" of the water bodies. These are all defined in the guidebook. Thus in a 10 meter x 10 meter by 5 meter floating cage in marine areas where there is sufficient current or tidal movement,we recommend the stocking density of 10,000 pieces of 5 - 6 inch bangus fingerlings which if harvested in 3 - 4 months can yield on the average 4.7 tons of bangus.

Unfortunately, others extrapolate that by deepening the depth of the cage to 15. They claim, they can triple their income not realizing that the bottom of the cage might not have enough dissolved oxygen to support life. The deeper the water, the lesser the dissolved oxygen because sunlight does no reach those areas as much as the upper portion and that oxygen gets to be dissolved into the water from wave action. Taal lake does not have any tidal movement as it is a landlocked lake.

Aside from the above explanation, Taal Volcano, in this picture, is a very active one. It is rumbling every 5 years on average, I think.

My friend who used to have a tilapia farm in Taal Lake, Batangas side, gave up his business after several cases of fishkill in the past. There were several instances where he would be harvesting tens of thousands of tilapia tomorrow or the next day, and tonight, almost all of the fish are dead. He and other fishpen farmers in the area suspect that the volcanic gases that find their way into the lake, affect the water's chemical mixture, poisoning the fish.

Philippine population is rising fast, around 1.8 million people per year, net of death and migration. It's like we are creating an equivalent of one Singapore every 3 years. The big demand for food like fish pushes for big supply of the commodity. A normal cycle in capitalism of supply meeting demand when the price and incentives are right.

While certain government regulations may help minimize fishkill and related problems in aquaculture, it's the threat of the actual fishkill and the huge financial losses associated with the event that is the biggest regulator in the minds of the entrepreneurs in the aquaculture industry. And that creates new opportunities for scientific research, like the development of new varieties of tilapia and bangus that are more resistant to certain biochemical fluctuations in the lake or other bodies of water.

Disruptions in Asia and the world

Below are some slides given by Suraj Moraje, Managing Partner of McKinsey and Co. Manila, "No Ordinary Disruption", during the BWorld ASEAN Regional Forum last November 24, 2016 at Conrad Hotel, http://bweconomicforum.com/index.php/morning-session/. The commentaries are mine, not Suraj's.

My first and last visit to Shenzhen, China was in 1998. There were many tall buildings already, roads are wide, but not as many as shown in the photo below.

Good comparison by Suraj here. ASEAN economies are modernizing and urbanizing fast while keeping their average population young. Modern technology will quicken the pace of productivity improvement of these young ASEAN people. It is really global enterprise competition and their endless innovation that modernize things faster, that results in mass production of many things, not so much due to government programs.

Big, young population. Many countries and blocs of countries like the EU salivate at this big advantage of the ASEAN. Big but ageing population means two requirements -- more migrant workers (from Asia), and/or more robots. But robots cannot change adult or baby diapers with warmth and smiles. This is also one reason why I never supported the PH state-sponsored population control aka RH law. Using taxpayers money and government agencies to "suggest" to people that big population is wrong.

On the technology aspect, I find these slides by Suraj very enlightening. But despite the "labor displacing" image of modern technology (self-driving cars, trucks, mechanized construction, etc.), I believe otherwise. I think that more modern technology will mean more jobs -- people who will manufacture, assemble, repair, upgrade those machines, engines and robots. All machines and bots will get "sick" and they will require people to fix them, upgrade or dispose and replace them.

One slide and arguments presented by Suraj that I don't agree with, the latter slide. Inequality is not a problem, poverty is. More inequality due to endless innovation and competition actually pulls up hundreds of millions of people out of poverty. Poor people who used to ride cows, carabaos and bicycles to work now ride motorcycles, e-bikes, 2nd-hand cars, or air-con vans and buses. They move faster, do multi-tasking and accomplish more things, so their income and network increases.

Thanks for those wonderful insights and information, Suraj. One more reason why BWorld fora are indeed very enlightening and highly educational.

BWorld 89, President Duterte's outbursts and PH economic momentum

* This is my article in BusinessWorld last October 27, 2016.

Several issues preoccupy President Rodrigo Duterte’s mind and mouth: the violent anti-drug campaign and murders, his anti-US, anti-EU, and anti-UN expletives and polemics (but later reversing his earlier attacks against these countries and/or multilateral bodies).

After his anti-Obama, anti-US tantrums before and during the ASEAN and related summit meetings, he repeated the same vitriol in his China visit last week, citing his “separation from the US” and that the Philippines is united with China and Russia against the world. As expected, he took back these assertions almost immediately, clarifying that the country cannot afford to be separated from the US the minute he arrived in Manila.

Spouting off these incendiary remarks then taking them back -- characterized as “sugod-atras” in Filipino -- should not be taken literally as advised by the President’s cabinet officials.

However, these unnecessary assertions have real, negative impact on business confidence in the country, especially for massive investment plans and pledges that remain on the “wait and see” mode since the campaign period (February 2016) until today.

Will these outbursts by the President ultimately derail the economic momentum of the Philippines as started by the previous Aquino administration?

The Economist magazine regularly pools some of the world’s biggest investment banks and ratings companies about their global economic forecast and GDP growth projections. The numbers are shown on the table.

This piece made these country groupings in re-constructing the table. Group A are traditional, developed economy allies of the Philippines; B are President Duterte’s “pivot new friends”; C are the major Asian friends and trade partners; and D are miscellaneous. Venezuela is included in D to show how socialism and heavy statism can lead to economic and business decline (see table).

These numbers show us the following:

One, group A remains to have sclerotic growth, they seem to be very lucky to grow 2% or higher. Unemployment rate is high, 5% and up, except Japan. Not shown on this table are the four EU countries which have incurred double-digit unemployment rates in July or August 2016: France 10.5%, Italy 11.4%, Spain 19.5%, and Greece 23.2%.

These figures show that the developed countries cannot be expected to provide more impetus to lead and drive faster global growth. Their capacity to provide more foreign aid, more loans and grants, is also compromised.

Group B has mixed results. China can be expected to lead regional growth and help pull upwards global demand, but not Russia. The latter remains limping due to low global oil prices, petroleum being one of its major export products, among the important factors.

Groups C and D continue to show fast growth potentials except the developed Asians like South Korea, Taiwan, Hong Kong, Singapore, and socialist Venezuela. The Philippines is expected to retain fast growth, third highest after India and China this year, also third highest next year after India and Vietnam, among emerging and developed Asians.

An important ingredient for faster growth is high and young population. Notice above that countries with 90+ million people -- Vietnam, Philippines, Indonesia, Pakistan, India and China -- are growing fast. The US, Japan, and Russia should belong to this category but they are growing slow, partly because they have an old and aging population.

Going back to our earlier question, will President Duterte’s emotional outbursts ultimately derail the Philippines’ economic momentum?

The answer seems to be no for two important reasons.

One, growth momentum is retained as various macroeconomic and infrastructure reforms laid by the previous administration are bearing fruit.

Two, our high and young population of 103 million people as of 2016 has become a potent force to provide the necessary market demand and labor force supply for more investments and entrepreneurial advancement.

So, despite the President’s incendiary remarks plus thousands of murders in the anti-drugs campaign that can potentially disappoint if not threaten big foreign investments planning to come to the Philippines, growth momentum is well in place.

Moreover, if this economic momentum is coupled with presidential sobriety and an anti-drugs campaign that is guided by due process, the country’s growth rate of 7%, or perhaps even higher, is very much possible.

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See also:

BWorld 74, Pres. Duterte's anti-corruption programs and Transparency Intl., July 30, 2016

BWorld 85, Drugs war morphed into war on critics of President Duterte? October 11, 2016

BWorld 87, Economic, fiscal and energy policies of the Duterte administration, October 17, 2016 
BWorld 88, Economic freedom and human rights, October 31, 2016

BWorld 53, Population and growth projections

* This is my article in BusinessWorld last April 06, 2016.

Many international agencies, both multilateral and private, have been producing growth projections for the Philippines and other developed and emerging economies in Asia. Most of these projections are short-term, usually for 2016 to 2018, and they show generally that the Philippines has better prospects for faster growth than other economies.

NEDA also launched the “Ambisyon Natin 2040” or “#SanaSa2040” campaign this week, which mostly focuses on a “Middle Class Lifestyle” long-term perspective for Filipinos. It is a modest goal actually compared to the more ambitious goal of “Developed Country by 2050” that was articulated by other groups about two years ago. The latter is an ambitious but not impossible goal.

One factor that contributes to this optimistic view of the Philippines is its huge and young population, an indication that it will result in more workers and entrepreneurs, more producers and consumers, more sellers and buyers.

Here is a set of data incorporating the top 10 biggest population countries and East Asian economies (see Table 1).

Our average population age is only one-half that of Japan, 13-14 years younger than that of China and the US, and 16-19 years younger than those of Singapore, South Korea, and Hong Kong. These rich and developed East Asian economies will soon be needing more migrants to sustain their economy, especially their huge number of pensioners. One can expect the big need for health professionals from highly-globalized and English-speaking Filipino professionals to fill the needs of these rich East Asians, not to mention those from US-Canada and Europe.

A big, young population means a big pool of highly trainable work force, eager to explore the world, and learn about the latest technological innovations and production processes.

Ten or 20 years from now, the situation will further tilt in favor of the Philippines because of its huge pool of young children at the moment. Meaning 10 to 20 or 30 years from now, they are the workers, managers, or shareholders of many enterprises here and abroad.

Nearly one-third of the Philippines’ nearly 100 million people in 2014 were babies up to 14-years old. That’s huge compared to Japan’s 13%, Hong Kong’s 12% and Singapore’s 16%. Only Laos and Cambodia have a similar situation but they have a smaller population (see Table 2).

  

There are important policy implications for the Philippines of the above data.

One, public health care and education should focus on the young and less on the adult population because education is now more decentralized with the continued revolution in IT. There is bigger role for household and private sector education and skills development these days are much easier and faster since intensive training with very competent international speakers can be done online.

Two, migration of university students, labor and professionals should be facilitated with few transparent rules and not be peppered with envy-inspired regulations and revenues-raising measures. In the case of rich and ageing East Asians (Japan, South Korea, Taiwan, Hong Kong, Singapore), north Americans and Europeans, either they will need more Filipino health professionals, or they will build retirement and modern health care facilities here and bring many of their ageing people here.

If more Filipinos have good-paying and stable jobs, they will need less welfare and subsidies from the government, and the state’s high and multiple taxation policies will no longer be justified.

Bienvenido S. Oplas, Jr. is the President of Minimal Government Thinkers and a Fellow of SEANET and the Albert del Rosario Institute (ADRi). minimalgovernment@gmail.com.

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See also: 
BWorld 50, Adam Smith and Jovito Salonga, March 21, 2016 
BWorld 51, WESM as market-oriented, PEMC as bureaucracy-oriented, March 25, 2016 

BWorld 52, Tax reform proposals for the Philippines, April 01, 2016

Demography 23: The UN, Depopulation and Climate, May 03, 2015 
Demography 24, The Maddison Project data, August 13, 2015 

Demography 25, Ageing societies, Japan's depopulation, December 29, 2016

Demography 25, Ageing societies, Japan's depopulation

Human population, whether rising or declining, should be left as individual and parental decision and responsibility, not government decision and responsibility. Should there be population explosion or population control/depopulation, it should not be government-sponsored.

Thus, in ageing societies, instead of government giving subsidies to households for having new babies, government can reduce income taxes, relax rigid labor laws, so that people will have more money for their kids, or they can hire a nanny to help them raise kids.

In countries where the growth of population is flat or declining, there are two solutions: have more robots, or have more migrants. Welfarism is an ideological enemy of free migration.

Here are some old news reports.

(1) "Germany's 82 million residents will dwindle to 74.7 million by 2050 and their average age will rise to nearly 50, assuming unchanged levels of migration, according to EU statistics agency Eurostat. Some projections are even more dire, putting the German population as low as 65 million by 2060.

At present, the age dependence rate is 27.5 on average in the 28-nation EU, but Germany and Italy are well above that level. The rate is projected to jump to 49.4 in 2050, when there will be only two people of working age for every retiree.

Most EU countries have raised their retirement age to 65 or beyond and are making citizens contribute longer for a full pension - but further increases lie ahead."

http://www.interaksyon.com/.../aging-europe-needs-the...

(2) "Globally, an estimated 44.4 million people suffer from dementia and the figure is projected to triple to 135.5 million in 2050 as the population ages, Alzheimer’s Disease International estimates. Nowhere is the problem more acute than inJapan, where an estimated 8 million people have dementia or show signs of developing it. By 2060, 40 percent of Japanese will be over 65, up from 24 percent today, according to National Institute of Population and Social Security Research.

When the national program, called Dementia Support Caravan, began in 2005, apartment managers were the first to join. They were dealing with tenants who complained about elderly neighbors banging the wrong doors, failing to sort bins, stealing newspapers and rubbing human waste on communal walls, said Hiroko Sugawara, who runs the program. Now demand is rising across corporate Japan." http://www.bloomberg.com/.../bank-tellers-serve-as...

(3) "Japan's birth rate hit a record low in 2014 at just 1,001,000 infants. When combined with 1.3 million deaths in the same year, that's a deepening population crisis. According to Japan's population institute, the overall population could dip to 107 million by 2040 — or 20 million lower than today.

At the same time, Japan's population is shrinking and graying, setting up a "demographic time bomb" that could radiate out globally through the country's Greece-level national debt and deep economic ties with China and the US." July 1, 2015.

http://www.businessinsider.com/half-of-japanese-people...

(4) "Despite an explosion in population greater than Malthus could have ever imagined, global living standards are higher than ever.

.. the precautionary principle, which this book rightly castigates. Based on a confusion between the sensible precept “be careful” and the nonsensical proposition that you can’t be too careful, it insists on taking the worst-case scenario as the outcome that should dictate policy. On that basis, one would never get in a car. And the massive technological advances that we have seen since the Industrial Revolution, and the reduction in global poverty that has followed, would never have occurred.

Another factor is the quasi-religious appeal of these prophecies, which may help to explain the papal encyclical to which I referred at the start. Even more recently, the Church of England at its latest synod called for all vicars to be trained in “eco-theology” as well as the Bible. It also called for churchgoers to do without lunch on the first day of each month, as a fast against climate change. Perhaps this should not be mocked: It might help combat obesity, which is probably more damaging than climate change.

“The End of Doom” is not quite in the same class as Matt Ridley’s classic, “The Rational Optimist,” but it is a good book and deserves to be widely read." July 27, 2015.

http://www.wsj.com/articles/apocalypse-later-1438039375...

(5) "Only 1.001 million babies were born in Japan in 2014 — a record low — and 1.269 million people died.

That's an overall loss of 268,000 people, and a signal of a population crisis in one of the world's most developed and debt-ridden economies."

http://www.techinsider.io/herbivore-men-in-japan-are-not... 

"TCOR and later UNEP’s Agenda 21 adopted and expanded the Malthusian idea of overpopulation to all resources making it the central tenet of all their politics and policies. The IPCC was set up to assign the blame of global warming and latterly climate change on human produced CO2 from an industrialized expanding population. They both developed from false assumptions, used manipulated data and science, which they combined into computer models whose projections were, not surprisingly, wrong. The result is the fallacy of global warming due to human CO2 is a subset built on the fallacy of overpopulation."

http://wattsupwiththat.com/.../overpopulation-the.../

Japan depopulating, something like 100,000 to nearly 300,000 people a year. Japan will be forced by circumstances to have more migrant workers, and/or more robots. The same thing will happen to China. So the China commie government should be more realistic now -- it should not alienate big population countries like India, Pakistan, Bangladesh, Philippines and Vietnam. Soon, these 5 countries will supply many of its manpower requirements. Or it may accept more people from Nigeria, Ethiopia, other African countries.

Migrant workers will eventually flood in, Japan will have no choice. Between ageing Japanese with dementia who cannot find their way home, would walk and get lost in the cold and die, and get foreign workers to take care of their ageing parents and grandparents, the latter should be preferable to more Japanese.

Liberalize travel and migration, relax those work visa restrictions. We should be moving towards a globalize and borderless world. That is what the Maddison data show -- as human population expands, as they move from one country/continent to another, to improve their lives and the new communities they adopted, per capita income rises. Visa restrictions and border sealing were 1900s thinking of governments that persist until now. But further human modernization, FTAs among countries, and demographic realities will force those governments to slowly tear down those strict border restrictions.

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See also:
Demography 21: China Overtaking the US' GDP Size in 2014?, May 02, 2014 
Demography 22: Japan's Depopulation and Migration Policy, May 11, 2014  
Demography 23: The UN, Depopulation and Climate, May 03, 2015 
Demography 24, The Maddison Project data, August 13, 2015

Macro Econ Update

My sister's accounting and auditing firm, Alas Oplas and Co., CPAs (AOC) has produced a new monthly publication, the Business and Economic Update. Issue no. 1 for this month was released last week. I helped in producing that paper.

In the coming months, the publication will tackle sectoral issues like energy, trade and investment, healthcare, agriculture, public finance, and so on.

AOC has many local clients, and some multinationals, doing business in different sectors of the PH economy. The firm is also affiliated with BKR International, a global network of accounting and auditing firms with about 500 partner firms worldwide. AOC is the only partner firm in the PH.

So issue #1 introduces the readers to the macroeconomic view of the PH economy in relation to  its neighbors in the ASEAN, North Asia and South Pacific, Europe and North America. Multinational companies and partner firms of BKR International will find the data useful.

Here are the macro data.

The size of countries' GDP now is getting more and more related to the size of their population, unlike before. This is because with increasing globalization and global mobility of goods and services across countries and continents, more people have more access to various economic opportunities. Thus, the economic size of countries with bigger population tend  to expand larger than countries with smaller population.

And unemployment data. Underemployment data is not included as there seems to be no internationally-comparable definitions and data.

Check it out guys, thank you.
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See also:
Ipagbawal ang GDP Growth, Part 3, April 06, 2015 
BWorld 1, PH Economy and Politics, Is there a Disconnection?, April 24, 2015 
Demography 23: The UN, Depopulation and Climate, May 03, 2015 
Why are Interest Rates so Low?, May 05, 2015
Market Reforms in the 2016 Elections, May 25, 2015

Fat Free Econ 56: Major Global Economic News of 2014

* This is my article for interaksyon.com the other day.

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Last year saw another roller coaster ride for the global economy. Below is a list of the most important economic news around the world, and what we can learn from them as we navigate 2015.

1. Cheap oil

This is definitely the single biggest item of business news of 2014. From a record US$107 a barrel in mid-June, West Texas Intermediate (WTI) at the New York Mercantile Exchange was halved, closing at $53 at end-2014.

Here is the chart for the last 45 years of WTI prices. The big question now is whether oil prices will breach the low levels of nearly $40 a barrel made in May 2009, during the US housing and mortgage financial turmoil.

Thank you competitive capitalism for reasserting yourself. The oil cartel OPEC was helpless in countering the new capitalism in shale oil and gas, especially in the US and Canada. The world has entered a world of rising abundance, with cheap oil seen cementing that achievement.

The shale oil and gas revolution in the US has catapulted it to become a major oil producing country, churning out more than nine million barrels a day. The chart below shows growth of oil production from 2008-2013.

Source: http://www.businessinsider.com/us-energy-production-boom-charts-2014-12

Ten million barrels a day or higher this year is not a far out possibility as the technology for shale oil and gas fracking  keeps improving.

There are huge negative implications for many traditional oil-exporting economies like Russia and OPEC member-countries. Russia’s currency ruble and its international reserves have been walloped in recent weeks.

In contrast, cheap and stable energy sources kept businesses in Asia humming. They are generally not hamstrung by expensive and unstable energy yet that can make Asian companies become less competitive. Data below show electricity production in billion kilowatt-hours (kWh).

Source: ADB, Key Indicators of Asia and the Pacific 2014

2. Major decline in prices of natural gas, rice and other commodities

More people around the world are becoming coffee drinkers. Less tea and beer? Below is the performance of selected commodities as of December 31, 2014.

Source: http://www.businessinsider.com/2014-futures-performance-2014-12

3. No fiscal crisis and low interest rates

Fiscal crisis by many fiscally irresponsible governments (FIGs) in Europe and elsewhere has been avoided in 2014. These countries have been hooked on a “spend-tax-borrow-borrow more” policy. If supply of credit does not keep up with demand and debt, interest rates should go up. This did not happen, which means capitalism worldwide is adjusting and getting more efficient, producing  more surplus that it can continue to bail out those FIGs with low interest rates even if they continue with their endless borrowing policy.

Data below show interest rates for UK, EU, US and Japan, 1999-2014.

Source: The Economist, November 20th 2014

In fact, there is deflationary pressure in Europe. High prices partly due to high taxes contribute to low spending by many Europeans. Cheap oil should encourage them to travel and spend more, but it seems the opposite is happening, as people are spending less.

  

Source: http://www.businessinsider.com/europes-chief-economist-says-deflation-is-coming-2014-12

There are two types of deflation. The good or benign one is supply-driven expansion of commodities due to productivity improvements in labor, capital and other factors of production. Thus, people can buy more powerful mobile phones and, flat TV at low or declining prices.

The bad or malignant type of deflation is when people are worried and scared to spend beyond their necessities. Low consumption means low demand for other people's production, which can lead to recession and hence more unemployment.

4. Inequality de Piketty

Inequality is natural and inevitable. Growth and wealth creation is faster if people have more economic freedom, the freedom to be industrious, hard-working, efficient and innovative. It also includes the freedom to be lazy, wasteful, non-ambitious and dependent, and these two sets of attitudes expand inequality in society.

So Thomas Piketty, the UN, WB, IMF, ADB, national governments, and socialists who complain a lot about rising inequality are wrong.

Today's poor are better off compared to the super-rich 100 years ago. For instance, the average life expectancy worldwide in 1900 was only 31 years. Even the super rich were lucky if they lived up to 50 years. Now, average life expectancy is around 69 years, so even the poor live longer.

5. Demographic dividends for developing countries

People are assets, not liabilities. So more people means more producers and consumers; more entrepreneurs and workers. Training people towards certain skills is relatively easier these days because of the continuing revolution in ICT.

Countries whose populations are either growing slow, or even depopulating like Russia and Germany,  are marked in red. Two decades ago, UK, France and Italy were in the top 20 most populous countries in the world. Now they are out.

Source: IMF, World Economic Outlook 2014 Database

Notice that several African countries are growing very fast – Nigeria, Ethiopia, Egypt and Congo. Also notice that five of the top 25 countries are from Asean alone. In Southeast Asia, demographic dividend is very visible in the Philippines.

Our young and big population means more working age, less dependent people. Other countries salivate at such a scenario. They need more robots and migrant workers to keep their companies and businesses running, and they will be forced to offer competitive pay to attract migrant labor, including those from the Philippines.

6. Asian economies leading global growth

And they are able to sustain it, at least over the short-term, judging from growth data shown below.

Source: IMF

Overall, there are more positive and hopeful news in 2014 and previous years that can catapult the Philippines among other countries towards more abundance and prosperity this year and beyond.

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See also: 

Fat Free Econ 52: Optimism in 2014, January 02, 2014

Fat Free Econ 53: WESM, Myths and Realities, January 22, 2014

Fat Free Econ 54: WEF and East Asia Growth Story, May 20, 2014 

Fat Free Econ 55: The President's 5th SONA and Market-Oriented Reforms, August 01, 2014

Fat-Free Econ 37: PH GDP Growth 2012

* This is my article yesterday in TV5's news portal.

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In November 30, 2012, this column made a rather bold statement about the economy for the fourth quarter of that year.

The National Statistical Coordination Board (NSCB) yesterday announced that fourth-quarter growth came in at 6.8 percent, or just 0.2 percent shy of the forecast.

It was not an “ambitious” figure to target for the fourth quarter. For one, the growth momentum for the first three quarters of the year was already there: 6.3 percent in the first quarter, 6 percent in the second, and 7.1 percent in the third (later revised upwards to 7.2 percent). Second, the growth momentum in Asia’s emerging economies is still there. For instance, growth rates in the third-quarter were 7.7 percent in China, 6.2 percent in Indonesia, 5.3 percent in India, 5.2 percent in Malaysia, 4.7 percent in Vietnam and 3.3 percent in Thailand.

This is one advantage of being a neighbor to faster growing economies. Even if political and economic governance in the home country is not that good, overall economic activity will be pulled up by the more dynamic neighbors through regional trade, investments and tourism. In the case of the Philippines and its neighbors in North and Southeast Asia, they seem to be pulling each other up.

The phenomenal economic expansion of the planet’s two most populous countries -- China and India, with a combined 2.5 billion population -- is a good example of how they have helped expand demand for goods and services exported by their neighbors in the region. Below are two tables showing the phenomenal economic expansion of many Asian emerging economies in just two decades. Purchasing power parity (PPP) valuation of gross domestic product (GDP) is used instead of the usual nominal GDP to correct for hyper valuation of goods and services in many rich countries.

Source: IMF, World Economic Outlook, October 2012 Database 

In just two decades, China’s economy has expanded 10.3 times from its 1992 level, while India has expanded 5.6 times over the same period. In contrast, the rich European and US economies have expanded only between 2-2.5 times.

The table below shows the expansion of a bigger set of Asian emerging economies:

There are several important implications of the above numbers.

One, many Asian economies increasingly are becoming the “growth anchor” for the rest of the world economy. Expanding wealth and consumer purchasing capacity in Asia creates additional demand for other economies' goods and services exports that may balance between anemic growth and stagnation, if not contraction.

Two, big population is generally an asset as the economy has more consumers, more workers and more entrepreneurs. This is clear in the cases of Japan Indonesia, India and China, countries with populations of 127 million, almost 250 million, 1.2 billion and 1.3 billion, respectively. Among the reasons often cited by investors who put their money here is that the Philippines has a big and young population that can easily be trained with new and changing skills. 

Three, intra-Asian merchandise trade and people mobility greatly help integrate their economies and in the process, pull each other up economically.

So in the absence of really globally or regionally disruptive events like war or huge fiscal collapse of the major European economies, the “default mode” is continued expansion of many Asian emerging economies like the Philippines.

More business-friendly government policies and bureaucracies will help the country sustain and even surpass current economic performance.

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See also:
Fat-Free Econ 33: Institutions and Why Governments Fail, December 09, 2012

Fat-Free Econ 34: Rise in Unemployment Rate Not Exactly Bad, December 20, 2012

Fat-Free Econ 35: World's 25 Largest Economies in 2012, January 02, 2013

Fat-Free Econ 36: Peso Appreciation, Growth and Less Government, January 06, 2013

PH Population 3: Census 2010 by Province

The National Statistics Office (NSO) release the results of the May 2010 nationwide census of Philippine population only last week, April 04, 2012. I will limit commentary here and make a separate discussion later why there was a big delay in the release of the results even if the NSO has submitted the census results to the Office of the President by late 2010. For now, I will just give the data.

For a complete list of provinces and chartered cities' population, see here,
http://www.census.gov.ph/data/pressrelease/2012/PHILS_summary_pop_n_PGR_1990to2010.pdf

A. Above 2 Million

1. Cavite	3.09
2. Bulacan	2.92
3. Pangasinan	2.87
4. Laguna	2.67
5. Cebu	2.62
+ cities of Cebu,	1.55
Mandaue, Lapu-lapu
6. Rizal	2.48
7. Negros Occ.	2.40
+ Bacolod City	0.51
8. Batangas	2.38
9.  Pampanga	2.01
+ Angeles City	0.33

B. Between 1-2 Million

1. N. Ecija	1.96
2. Camarines Sur	1.82
3. Iloilo	1.81
+ Iloilo City	0.42
4. Quezon	1.74
+ Lucena City	0.25
5. Leyte	1.57
+ Taclocan City	0.22
6. Isabela	1.49
7. Bukidnon	1.30
8. Negros Or.	1.29
9. Tarlac	1.27
10. Bohol	1.26
11. Albay	1.23
12. N. Cotabato	1.23
13. Cagayan	1.12

C. Nearly 1 Million

Palawan + Puerto	0.99
Princesa City
Zambo. Del Norte	0.96
Zambo. Del Sur	0.96
+ Zamboanga City	0.81
Davao del Norte	0.95
Maguindanao	0.94
Lanao del Sur	0.93
Lanao del Norte +	0.93
Iligan City
Davao del Sur	0.87
Misamis Or.	0.81
+ Cag. De Oro City	0.60

Central planners in government -- local, national and multilaterals, foreign aid -- always look at population data with keen interest. They need to plan how many schoolbuildings, hospitals, public markets, etc. to build, how many public school teachers, public health professionals to hire, and so on. Politicians plan their campaign strategies based on population statistics per precinct, per sitio, per barangay, per municipality or city, per province.
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See also:
PH Population 1: as of August 2009
PH Population 2: Projections 2010 by Province, August 04, 2010