One-sided Deal

On 27 May 2008, the Joint Foreign Chambers of Commerce wrote to the Philippine President, complaining about the government's move to roll back the privatization of the country's dominant power producer. On 6 June, the Philippine senate blasted the joint chambers for 'interferring' in its decision-making. On 12 June, Ms. Arroyo, Philippines' President, expressed appreciation of the contributions that foreign investors made to the country in a barely publicized conference. This week, Ms. Arroyo is visiting the USA, trying to woo investors.

Today, the Asian edition of the Wall Street Journal runs an article with this caption : "Powering Down the Philippine Economy". The article reveals that several European ambassadors were preparing to file a diplomatic protest over the dressing down of the joint chambers a few days before Ms. Arroyo's expression of 'appreciation' on 12 June. The article also points out that the senators who lashed out at the foreign joint chambers were Arroyo's allies/minions, and that Arroyo even brought one of them with her to the USA.

A few days ago, a columnist of the Philippine Star, a popular local newspaper, argued in his article that the Philippines does not need foreign capital. It only needs better policies. I guess if you have better policies and a more business friendly bureaucracy, more local capital would be put to use, resulting in more jobs. You do not need foreign capital to survive. However, if you have foreign capital, you can grow faster. I do not see how anybody can argue with that. China closed its doors to foreigners in the nineteenth century. Since thirty years ago, it has learned to use foreign skills and capital to grow itself, without the fear of being taken for a ride.