Get the latest news about the state of political stability, cybersecurity, legislative changes, and recent economic developments in the Philippines with NordCham and PSA
On February 14, 2024, NordCham Philippines held its monthly virtual event, "Latest Updates on the Situation in the Philippines," via MS Teams, in collaboration with its advisory partner, Philippine Strategic Associates (PSA). The session for this month delved into crucial topics ranging from the state of political stability to cybersecurity updates, legislative changes, and recent economic developments in the country. Below is a summary of the latest updates discussed in the meeting.
State of Political Stability in the Philippines
The discussion on political stability started with an analysis of recent developments concerning the growing rift within the governing coalition led by President Ferdinand Marcos Jr. and former President Rodrigo Duterte. This situation arises from the former president's forceful statements and accusations, primarily directed towards President Marcos Jr., including allegations of drug abuse. These remarks have ignited a contentious debate, particularly among their respective teams and supporters, who were once united under the UniTeam banner.
PSA pointed out that a fracturing of governing coalitions, especially as the mid-term approaches, is almost always expected, but this one appears to have occurred earlier than anticipated. According to PSA's analysis, tensions between these two factions are likely to escalate, however this issue will not necessarily translate to disruptions in day-to-day government operations. This may hold true, especially as President Marcos Jr. continues to reassure that his coalition and the public are still standing strong, highlighting that 'it is mostly the same'.
The next point of discussion of PSA under the topic of political stability is about the rumors surrounding the potential arrest of former President Duterte in connection with alleged International Criminal Court (ICC) investigations into his administration's anti-drug campaign. PSA pointed out that as of the moment, the circulating rumors against the former president have been debunked and are unlikely to materialize, particularly given President Marcos Jr.'s clear statement that his administration will not assist any ICC investigation. He also reminded all government officials and agencies not to cooperate with the ICC should they be approached.
Further discussion delved into the issue of Mindanao ‘secession’, where former President Duterte called on Mindanao to secede from the rest of the Philippine Republic through a signature campaign. Overall, PSA observes that Mindanao ‘secession’ lacks tangible support at the national level, particularly among government power brokers, members of congress, and cabinet officials, who have firmly expressed their opposition to this idea.
Overall, PSA's assessment is that the current state of political stability and associated issues in the Philippines is not an immediate cause for concern for businesses, both in Metro Manila and across the country. PSA emphasized that despite prevailing challenges, the Philippines remains a favorable destination for conducting business activities, making investments, and enjoying leisure pursuits. This affirmation underscores PSA's confidence in the resilience of the Philippine business environment and its potential for continued growth in 2024.
Recent Developments in Cybersecurity news
In recent cybersecurity news, on February 8, 2024, President Marcos Jr. approved the National Cybersecurity Plan 2024-2025. According to Department of Information and Communications Technology (DICT) Secretary Ivan Uy, this plan provides policy direction as well as operational guidelines to bolster the country’s cybersecurity posture and fortify its cyberspace against online threats.
The comprehensive plan will also address the need to develop sound policies to ensure a safe cyber landscape for the country, identify cyber assets and infrastructure in need of protection, and provide government agencies and sectors with guidelines on how to respond to cyberattacks or attempts.
In terms of cybersecurity efforts, it was noted in November 2023 that three bills aimed at boosting cybersecurity were included in the list of administration priority bills. These include the Cybersecurity Act (pending in the Senate since November 2022), the Anti-Mule Act (pending in the Senate since April 2023), and the Online Site Blocking Act (included in the proposed amendments to the Intellectual Property Code). As of the moment, PSA sees this move as an effort by the government to clearly enhance its cybersecurity efforts at the national level. This proactive approach reflects a recognition of the increasingly interconnected nature of cyber threats and the importance of robust cybersecurity frameworks to safeguard not only national interests but also global security and stability.
Legislative Updates
PSA also discussed some notable legislative updates in the country, particularly highlighting the passage of The Ease of Payment of Taxes Act or RA 11976, which was signed into law on January 5, 2024.
This implies that individual taxpayers, including those who are married, are now able to submit their tax returns either electronically or manually. They can avail themselves of services offered by authorized agent banks, the Revenue District Office through the Revenue Collection Officer, or an authorized tax software provider. Additionally, tax payments can be made to any authorized agent bank, regardless of location within the country. Such flexibility will enable both employers and individual taxpayers to effectively handle their tax filing responsibilities and reduce the likelihood of penalties resulting from missed deadlines or filing inaccuracies.
With this, PSA anticipates that throughout 2024, the administration will continue its efforts to deliberate on pending priority bills until the conclusion of the 19th Congress. Given Senator Ralph Recto's appointment as the new head of finance, PSA expects him to spearhead and just continue the ongoing passage of these priority bills.
Latest Economic Updates
Turning to the final topic of discussion, PSA examined recent economic developments in the country, particularly noting a further decline in headline inflation, or overall inflation, in the Philippines to 2.8% in January 2024 from 3.9% in the previous month. PSA noted that the current inflation rate remains within the government’s target range of 2% to 4%. PSA cited that there are various factors influencing the inflation rate, primarily in the sectors of food and non-alcoholic beverages, followed by housing, water, electricity, gas, and other fuels. While the overall trend indicates a tapering off of inflation, the situation differs for rice, with rice inflation continuing to surge to 22.6% in January 2024 from 19.6% in December 2023.
PSA highlighted that the higher rice inflation is due to rising global market prices and a low initial benchmark, suggesting that annual rice inflation could persist and increase further in the coming months of the year. Nevertheless, PSA remains hopeful that the government will exert its full efforts at the national level to address the problem.
Shifting focus to the academic sector, PSA discussed the Philippines’ low performance in the 2022 Program for International Student Assessment (PISA), indicating that the students in the Philippines are five to six-year behind in learning competencies compared to other countries.
PSA concluded that the Philippines' competitive advantages in the education sector are at risk of further decline relative to neighboring Southeast Asian and Asian countries. However, PSA remains optimistic that the Philippine government and the Department of Education (DepEd) will continue their efforts to enhance performance in PISA and strive to reach the ranks of top-performing countries like Singapore. Nonetheless, PSA emphasized that achieving this goal will require time, given the ongoing implementation of education reforms.
Following the comprehensive presentation and analysis of key updates during the event, participants actively engaged in a series of Question and Answer (Q&A) sessions. These sessions provided an opportunity for attendees to seek further clarification, share insights, and address any lingering questions or concerns they had regarding the topics discussed.
ABOUT THE EVENT
NordCham Philippines’ “Latest Updates on the Situation of the Philippines,” with its advisory partner PSA Philippine Strategic Associates, is an exclusive and monthly virtual event that delivers a comprehensive overview of the Philippines' key developments, covering vital safety updates, economic insights, and significant issues in the country's political landscape.