State visit to Japan

STATE visits should not be frowned upon. They are the strongest expression of friendly bilateral relations between two nations and characterized by official public ceremonies. They are an affirmation of the decades-old bonds between two sovereign states from which relations are cemented and developed further.

The state visit of President Ferdinand Marcos Jr. to Japan from February 8 to 12, which I joined as part of the high-level private sector delegation, is a smashing success, based on the numerous commercial deals and defense and political arrangements signed between the two Asian nations. I want to focus on the financial and investment deals forged during Mr. Marcos’s visit to Japan. The list is quite long but I will cite some of them based on their immediate impact on Philippine economic growth and job creation.

The Philippines and Japan signed 34 investment agreements worth about $13 billion, comprising of closed deals and prospective ones.

The Philippines can expect more investment deals and pledges in the commercial and investment agreements. Investment pledges include those in manufacturing, infrastructure development, energy, transportation, health care and renewable energy. They followed the first meeting between President Marcos and Japanese Prime Minister Fumio Kishida in Tokyo. coming months, depending on the results of discussions from a large business forum during the President’s state visit that gathered 80 Filipino businessmen and 300 Japanese companies.

The Philippines and Japan signed 34 investment agreements worth about $13 billion, comprising of closed deals and prospective ones. The Philippines can expect more investment deals and pledges in the coming months, depending on the results of discussions from a large business forum during the President’s state visit that gathered 80 Filipino businessmen and 300 Japanese companies.

Japanese investments aside, Tokyo is the Philippines’s biggest source of cheap official development assistance funds. Mr. Marcos’s official visit resulted in the signing of several loan agreements and extensions for Philippine infrastructure projects, including a $3-billion exchange of notes to finance major commuter rail projects.

The official funding covers the construction of the North-South Commuter Railway and its extension, also known as the Clark-Calamba Railway, a 147-kilometer stretch that is now under construction. This in- frastructure project is a game changer that will bolster our economic expansion in the near future. It aims to improve connectivity within the Greater Manila Area and integrate Luzon’s railway network.

The Philippine railway network is probably one of the most underdeveloped in Asia—an anomaly in a modernizing economy as reflected in daily traffic jams in the metropolis.

I am pleased to learn that the Department of Transportation through Secretary Jaime Bautista and Japan International Cooperation Agency agreed to plan three to four more underground railway systems in Metro Manila that will extend all the way to Cavite province.

President Marcos’s state visit, as I have mentioned earlier, led to many

To name a few, the business agreements include a wiring harness manufacturing expansion project with Asti Corp.; a printer manufacturing expansion project with Brother Industries Ltd.; a hotel construction project with DoubleDragon Corp. and Iwata Chizaki Inc.; and a factory expansion project with Japan Tobacco Inc.

Also included in the list are a new factory for auto parts with Kurabe Industrial Co, Ltd.; energy, transportation, health care and afforestation projects with Marubeni Corp.; an automobile manufacturing expansion project and a commitment renewal to meet production targets with Mitsubishi Motors Corp. Mitsubishi Corp., one of Japan’s sogo sosha, expressed interest in Philippine infrastructure, transportation, commercial and residential real estate development and mass housing projects in the Philippines.

My own Villar Group is expanding its partnership with Mitsubishi Estate Corp., among the 35 letters See “Villar,” A11

John Mangun

The middle class OuTSIDE THE BOX

For an economy to be successful, the government and society in general must encourage and facilitate upward economic mobility, the ability of an individual to move up through the economic classes ideally to the top of earners and wealth holders.

Opportunities for education are critical. The taxation system must give a break to those who make less income. Likewise, creativity and innovation must also, if not rewarded, at least not hobbled by government rules and regulation.

The society must also view “winners” as role models and not looked down upon as people who “got lucky” or with “crab mentality.” Can every child grow up to be the president of the nation or a multi-billion-peso enterprise owner? No, but every child must be trained and given as many tools as possible to reach as far as hard-work, smart-work, and ambition can carry that person.

Why is upward mobility imperative? It is that there is one group that is the engine of the economic bus that carries all the rest down the road to prosperity.

When the Bureau of Customs talks about meeting its revenue targets, who paid for it? The Middle Class. Who “bought” the more than “P455 million in humanitarian and development aid to Visayas and Mindanao that Philippine Red Cross Chairman Richard J. Gordon reported.” The Middle Class. Who was responsible for “car sales post double-digit growth in January, tracking economic recovery?” And who created that economic recovery? The Middle Class.

It is The Middle Class that operates, manages, and is then the customers of companies owned by the

When the Bureau of Customs talks about meeting its revenue targets, who paid for it? The Middle Class. Who “bought” the more than “P455 million in humanitarian and development aid to Visayas and Mindanao that Philippine Red Cross Chairman Richard J. Gordon reported.” The Middle Class. Who was responsible for “car sales post doubledigit growth in January, tracking economic recovery?” And who created that economic recovery? The Middle Class.

“oligarchs.” It is The Middle Class whose taxes provided the pandemic “ayuda.”

The Middle Class is not first defined by income because that varies from country to country. It is defined by what a family can afford and then by how much income that requires. Home ownership is first.

According to a 2020 survey, about 60 percent of households in the Philippines occupied housing units they owned (2019 Annual Poverty Indicators Survey). However, less than 50 percent own a car. Other factors include being able to provide a college education for the children, retirement security, and enough healthcare insurance coverage. According to the data from the Philippine Institute for Development Studies (PIDS), the income to be called rich for an average household of five is a monthly net income of P182,000 and up. This benchmark increases as the economy and inflation goes up. In 2020, to be part of The Middle Class a family needed at least P63,700 and that number is definitely higher today. The latest Family Income and Expenditure Survey by the Philippine Statistics Authority (PSA) shows that majority (58.4 percent) of Filipinos belong to the low-income class, while the middle class comprises around 40 percent of the population. Only 1.4 percent of Filipinos are in the highincome class.

Spending is a factor. Low-income families spend more than 50 percent on food. Middle income spends twice as much as low-income on education and healthcare. While inflation affects everyone, to the middle class, it has a much bigger implication. When the cost of living or tax increases, they feel the brunt of thee increases. In

Dennis Gorecho