Macapagal's State of the Nation Address

As Gloria Macapagal-Arroyo prepares to give her State of the Nation (SONA) address today, we can examine how well she has delivered on some of her economic promises from last year and from earlier addresses.

One of the president's most noteworthy achievements is the reduction of the federal deficit from P200 billion in 2003 to P12 billion in 2006. This year the government has announced that it will balance the budget despite the worldwide inflation woes. The reduction of the deficit, though, has not come through drastic cuts in government expenditure. In fact, the national budget has gone up by about 80 percent over this period.

What has made this possible is the expanded valued added tax (E-VAT) on petroleum products.

Macapagal has delivered on building infrastructure. In fact, she is built more than any president since Marcos and without the same authoritarian powers to bypass the bureaucratic red tape of the current process.

The NAIA 3 terminal, for example, at Manila's international airport is already partially open and is expected to begin receiving international flights by around Aug. 8. The Subic-Clark segment of the Subic-Clark-Tarlac Expressway (SCTEx) opened on April 29, and has since collected daily tolls of about P550,000. Construction has started on both Clark North and Clark South and two Japanese contractors have agreed to build four SCTEx interchanges.

Refurbishment of airports in the Visayas and other parts of the Philippines is also well underway. A number of airports have just started receiving flights from major domestic airlines after years of absence.

The NorthRail project has been a subject of controversy but according to the administration the rail system is still scheduled for "substantial completion" by the original target date of Feb. 2010. We should bear in mind that the Northern Luzon rail line was not originally Gloria's baby. It was conceived many years before she came into office, but it has been this administration that has gotten the project off the ground.

Most of the anger directed at Macapagal in terms of her economic performance has been related to the current high price of fuel and food, both of which are due to external factors beyond the government's control. However, prices in the Philippines have still remained lower than those in other Asian countries, in no small part due to the funds provided by the E-VAT tax.

iPhone in Asia

iPhone will be available in 20 more countries on August 22. It's not known exactly which countries will be included but the short list of 50 countries under consideration include the Philippines, Macau, Singapore and India.

The iPhone is already shipping to Australia, Hong Kong, Japan and New Zealand in Asia-Pacific region. In some areas, people waited in line for two days to get the new gadget.



A mock iPhone is on display at the first day of the release in Hong Kong, Friday July 11, 2008. As Apple rolled out its newest iPhone in Asia Friday, dealers and buyers said it's only a matter of time _ maybe as little as a few days _ before the popular device hits the region's thriving underground marketplace. (AP Photo/Kin Cheung) (AP/KIN CHEUNG)



Models hold the new iPhones during the first day of the release in Hong Kong, Friday July 11, 2008. (AP Photo/Kin Cheung) (AP/KIN CHEUNG)





A customer shows Apple's new 3G iPhone mobile handset at the Softbank shop in Tokyo on July 11. Apple's international launch of its iPhone 3G has begun in several Asian countries. (AFP/Yoshikazu Tsuno)

ASEAN and Japan

Japan has tended to be rather cool to Asian integration in the past. About two decades ago, there was considerable effort to initialize an Asian economic union but Japan's reticence was the major cause of the movement's downfall.

There have, though, been Japanese leaders who have recognized the value of the concept including former Prime Minister Takeo Fukuda back in 1977. Fukuda liked what he saw in the Association of Southeast Asian Nations or ASEAN and backed the idea of unity between Japan and the grouping of nations.

Just this year, Prime Minister Yasuo Fukuda, the son of Takeo, mentioned important goals for Japan that mirrored the "Fukuda Doctrine" of his father.

Japan now backs integration movements that would include ASEAN plus Three, including Japan, China and South Korea; the Asian Community -- which includes ASEAN plus Three leaders and their counterparts from Australia, India and New Zealand, and smaller interregional trade relationships. In all cases, ASEAN will serve as the central connecting point.

And we've seen for the first time, the Japan International Cooperation Agency enter into a formal agreement with ASEAN to cooperate on meeting specific goals including creating an ASEAN hub by 2015, and the formation of an East Asian free trade area by 2020 or earlier.