Philippine President Aquino's Report Card

Philippine President Benigno S. Aquino III's 105-minute state-of-the-nation address, delivered yesterday, was an exhaustive catalogue of what he has done and where the country now stands that drew at least 80 rounds of applause from assembled lawmakers and dignitaries.

Against the odds, the Philippines today features the best performing economy in Asia, with 7.8 percent gross domestic product growth in the first quarter of this year. The accelerated growth was also accompanied by marked improvements in the country's overall credit rating, with upgrades from Fitch Ratings and Standard & Poor's. Even lowly Philippine Airlines has now had its ban lifted on flying to the European Union.

Aquino deserves high marks for how far the country has come in the since his 2010 election to the presidency. In particular, while the economy remains hostage to inward remittances from overseas workers and to outsourced call centers, manufacturing has made a respectable comeback, rising 9.7 percent as foreign direct investment into the sector surged to a still-low US$1.03bn, from just $119.4m in 2011 and a net outflow of $1.3bn in 2010.

Not all, however, are happy or completely satisfied with Aquino's accomplishments. The normally staid and conservative business community said it wants more roadmaps and timetables of what the country will look like when he steps down in 2016, suggesting that continuity is paramount for the business sector. The administration has shown little desire to push up foreign direct investment, saying it exposes the country to the vagaries of the international economy - as if call centers and overseas remittances don't. The multiplier effect of manufacturing means three jobs are created elsewhere for each manufacturing job. There is little multiplier effect from either call centers or remittances.

With less than three years to go in his administration, it remains to be seen if Aquino can put in place the institutional and functional building blocks that would allow for a rational transition to a responsible successor government. In the Philippines, the odds are sometimes not that good. The reign of President Fidel V. Ramos from 1992 to 1998, considered the most effective in recent history, was followed by the election of Joseph Estrada, a fading movie star famously fond of women and drink and who by all accounts plundered the country of millions of dollars before he was driven from office by a combination of public protest, elite anger and military intervention in 2001.

Despite being a convicted felon, Estrada has now been elected mayor of the City of Manila, and, with Vice President Jejomar Binay in tow, appears to be rebuilding a formidable political machine for future use. Odds are good that BInay, who is not from Aquino's party, could be elected president in 2016.

While the president has been given high marks for cleaning up the bid process for government projects, the fact is that his much-hyped public-private program launched in November 2010 is moving very slowly. Only three major projects have been let, with the program hampered by bureaucratic inefficiencies, with private sector partners growing impatient.

The government announced that seven more programs are ready for bidding and that all will be awarded within the next two years. However, many have greeted the announcement with skepticism.

As usual, the president's address was met by loud protests from the militant left, who had brief violent clashes with riot police who blocked their way to the Batasang Pambansa building where Congress was holding its joint session.

The business community was obviously disappointed that the president didn't mention mining, the core issue involving the country's rich natural resources and economic activity.

More than a year after pro- and anti-mining advocates clashed in a mining forum and after the release of Executive Order No. 79, the mining industry is still in limbo and the government still has to deliver on its promise to introduce amendments to the Philippine Mining Act of 1995.

At the core is the issue of revenue sharing. At present, all the government gets from mining operations is a 2 percent excise tax in addition to income and other regular taxes - a tax that has spurred widespread smuggling of gold, nickel and other ores out of the country via Hong Kong to China.

The government wants more but the mining industry warns it could drive investors away. Mining has long been a thorny issue between pro- and anti-mining groups and the Aquino government is choosing to sit on the fence, it seems.

Human rights groups are also alarmed over the Aquino government's lack of interest in addressing the continuing culture of impunity and violence in the country. New York-based Human Rights Watch said it was disappointed the president didn't take "the opportunity to communicate to the military and the police that they will be held accountable for human rights violations."

Although there was a brief mention of slain radio commentator and environmental activist Gerry Ortega, the president largely kept mum on political and media killings. Human Rights Watch fears the president's omission could embolden abusive state forces and officials in attacking critics and activists.

Advocates of press freedom were also disappointed. Four years after he promised during his campaign to push for the passage of the Freedom of Information (FOI) bill, Aquino appears to have forgotten the legislative measure that media freedom advocates have been campaigning for since long before his presidency.

And while he dedicated four paragraphs of his speech to the GRP-MILF peace negotiations, he was eerily silent on the other insurgency front - one that is as old and intractable as the Moro rebellion - the communist insurgency. His government has virtually shut the door on peace talks with the National Democratic Front (NDF), the political umbrella of the Communist Party of the Philippines (CPP) and its armed group, the New People's Army (NPA).

Coupled with his silence on political killings, many fear an escalation of violence and armed confrontation between the CPP-NPA and government forces in the remaining years of the Aquino presidency.

Even before Aquino's address, the Mindanao spokesperson of the NDF already warned of the "lies" of the president. NDF-Mindanao spokesperson Jorge Madlos likewise belittled Aquino's economic accomplishments. saying "rapid economic growth" is due to "the reality of the intensified crisis and the sharp decline of the people's standard and quality of living as a result the Aquino regime's insistence to pursue the neoliberal policies of liberalization, deregulation, privatization and denationalization."

Madlos also cited the "jobless growth" of the economy. Despite the 6.8 percent GDP increase in 2012, more workers - 11.88 million - are unemployed or effectively underemployed according to think tank IBON. The number of unemployed even increased by 48,000 to reach 4.4 million in 2012, IBON added.

And despite the hype of sustained economic growth under his administration, the Movement for Good Governance, a coalition of citizens and organizations, can only give the Aquino administration an overall 5.77 accomplishment rating (scale of 10) for 2012 - good, but just about average.

Aquino has two more addresses before he steps down in 2016 but he has yet to prove that the economic growth translates to more jobs and more food on the table. Before his "tuwid na daan" (straight path) slogan becomes empty rhetoric, his administration has to see to it that the big grafters in government are convicted. And to begin with the former president Gloria Macapagal Arroyo, who is facing plunder raps.

The next three years will define where the second Aquino government will be placed in the history of Philippine governance. Not being tainted with corruption is not enough to leave behind a legacy.

(with reporting by Edwin Espejo, who blogs for Asian Correspondent)