No alternative to stability

There was a time when political turmoil did not have a direct impact on the conduct of business in the country and the overall economy.

Now it seems that every ripple created by the turmoil caused by the budget manipulation and the subsequent flood control scandal hits the financial markets hard.

In a speech at the P&A Grant Thornton Office in Makati City, Securities and Exchange Commission Chairperson Francis Lim said the challenges have become very real, with the flood control projects scandal shaking public confidence while wiping out P1.7 trillion in market value of publicly listed companies in just three weeks. The irony was that it happened despite rising corporate earnings.

The stock index had slipped in the past, but the recent dip is remarkable, considering it is the first in some time that a local event caused the weakening.

Lim indicated that investors aren’t leaving the country due to weak fundamentals but due to weak integrity. “It’s a stark reminder that corruption is a weapon of mass wealth destruction. When trust breaks down, capital dries up, and everyone — government, business, and the public — pays the price,” he said.

Lim said that investors need to face the hard truth, which is that the local stock market is a laggard, which reflects something more profound — a crisis of confidence.

Many firms still hesitate to go public, while others that have chosen to do so are leaving the stock market.

The Makati Business Club (MBC) stated that snap elections, as proposed by some members of Congress, suggest that instead of calling for the resignation of elected officials, we should work to reform the system, strengthen institutions, and make democracy function effectively.

Many proposed systemic changes have been languishing in the legislature, including an anti-dynasty law, amendments to the bank secrecy laws, and Freedom of Information (FoI) reforms, among others. Other changes can even be implemented administratively.

Simply changing the people in power will not achieve lasting improvement in the country’s governance.

In the current investigation on corruption relating to flood control projects, people are demanding transparency, accountability, and justice.

The 2026 national budget must truly reflect national priorities, including only well-conceived needs-based priority infrastructure projects and rules-based social programs, and exclude explicitly social programs where the availment of services is dependent on patronage and political intervention.

A multi-sectoral group of distinguished experts should be formed to formulate an improved system for prioritizing, planning, funding, and implementing public infrastructure projects.

The body must be founded on principles of sound planning, transparency, fair bidding, and citizen monitoring, which are some of the immediate measures that need to be implemented for meaningful reforms.

The MBC pledged its support to the Independent Commission for Infrastructure and other national government agencies conducting investigations into past projects to uncover anomalies that would lead to the identification and prosecution of those responsible.

Thus, the business sector wants reforms, not the resignation or overthrow of the duly elected government, which would only further push the economy to a point of no return.