The election of hardliner Rodrigo Duterte as President of the Philippines has led to fears for the country’s international standing, but experts have sought to downplay his potential impact on trade.
The mayor of Davao cruised to a landslide victory on an anti-crime ticket, in a campaign that was filled with crude and inflammatory remarks on human rights, rape, territorial disputes in the South China Sea, and even the Pope.
His opponents have branded him “the executioner” and claimed that he will isolate allies on the international stage, but Duterte himself urged people to see past his rhetoric, saying: “For every profanity, there’s a story behind it. People should go beyond my cussing.”
This too seems to be the message of many analysts who believe that while Duterte may be inexperienced in foreign and trade policy terms, he will surround himself with the requisite circle of advisors to allow the Philippines growth story to continue.
“Duterte has himself openly admitted that he has no substantial economic policies as yet, and that his plan is to appoint some experts once he is in office. However, one would have expected that he could have had some advisers prepare some major economic policies during his election campaign, and his lack of focus on the economy is a key concern for global investors,” Rajiv Biswas, Asia Pacific chief economist at IHS tells GTR.
Among the key issues facing the new president will be his ability to maintain the country’s strong 6%+ GDP growth, which has been largely based on its IT and business process outsourcing (BPO) industries, as well as a huge volume of remittances from overseas.
He will have to balance this with keeping his electoral mandate: eradicating poverty and decriminalising the Philippines – areas in which he enjoyed great success in two decades as mayor of Davao City.
“The first thing to say is that this has been a huge victory for democracy and in terms of trade you have to realise first that people are campaigning for the presidency based on many things. It’s one of those things that he hasn’t said much about but once he’s in the job he will surround himself with advisors, just like many others in the past,” Dr Reuben Mondejar, an expert on Filipino economics and politics at City University, Hong Kong says.
He adds that the perceived economic success of the outgoing President Benigno Aquino is not viewed as such internally and that he failed to address the widespread poverty in the country. While the Philippines may be the strongest-growing nation in the Asean region, Mondejar puts that down to legacy policies of the Estrada government from year 2000.
Have you been to Manila? Once you land at the airport there’s no infrastructure, there’s an elevated roadway that has been under construction since Aquino began his regime. Dr Reuben Mondejar, City University Hong Kong
“It’s the same as under Estrada: everyone thought this guy is a comedian, but he surrounded himself with good experts. That will always be the case. Have you been to Manila? Once you land at the airport there’s no infrastructure, there’s an elevated roadway that has been under construction since Aquino began his regime. People were so dissatisfied with that,” he tells GTR.
Some of the major flashpoints of his campaign threatened foreign relations with some of the Philippines most important trade partners.
In relation to the ongoing territorial disputes in the South China Sea, he threatened to ride a jet ski bearing a Filipino flag to the Chinese-occupied Spratly Islands to personally claim them for the Philippines.
In recent weeks, this rhetoric has cooled and he sought a more conciliatory approach, saying that the countries could work together on oil and gas development projects, as well as suggesting the role of China’s export credit banks in constructing the Filipino railway network.
He also threatened to “kill his children” if they took drugs, called the Pope a “son of a whore”, and made a joke out of the rape of an Australian woman in the Philippines in the 1980s (the latter resulted in a diplomatic incident involving both the Australian and US ambassadors in Manila). Few expect the grandstanding to outlast the election period, however, with some analysts suggesting that his hardline tactics could help introduce positive reform.
“His hands-on governing style could actually prove beneficial in pushing through certain key reforms. One notable area where Aquino fell short was in pushing through improvements to the country’s infrastructure.
“If Duterte is able to make progress here, the Philippines may even see its long-run prospects improve,” says Gareth Leather at Capital Economics, who maintains his 6.5% forecast for Filipino growth this year.
With his unerring ability to insult people, his lack of articulated policy and his outrageous stance on many political hot potatoes, Duterte has drawn comparisons with US presidential hopeful Donald Trump.
Mondejar, who has studied Southeast Asian politics for a quarter-century, dismisses this idea, saying: “The only valid statement is that people are fed up with the establishment: I think the comparison ends there. First of all, Donald Trump is rich enough, he doesn’t need money from the others to win. Meanwhile, Donald Trump has only been a politician for 10 months, Duterte has been a politician for three decades!”
As the US election season rolls on and Duterte finds himself with a global audience, this is unlikely to be the last time you will read such comparisons being made.