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The global nightmares of 2020

Yet on the contrary, businessmen are the most inveterate optimist. I have yet to encounter a person determined to go into business and stop mid-stream from making the plunge for fear of failure.

Ed Lacson



So many experts have written about the looming global economic and financial challenges in 2020 that could be the tipping point for the world.

Cited is the sporadic trade war between the United States and China, which has disrupted and slowed down the free exchange of goods and technology among nations. This trade battle has polarized many countries which further complicated what is already a toxic global situation. The decoupling of these two big economies has practically shut off the exchange and flow of technology, talent and capital between countries.

In the Middle East, there is a grave threat to the region’s uneasy peace when Donald Trump ordered the assassination of a top Iranian general and the self-inflicted failure of US foreign policy in Iraq and Syria.

In Europe, the eventual Brexit, or British exit, from the European Union is causing anxiety among European countries in the bloc, as well as from countries trading with Britain, because of the uncertainties such an exit brings primarily on trade and the movement of capital and labor across Europe.

Elsewhere, public discontent and political conflicts in Turkey, Hong Kong, Africa and some Latin American countries could escalate the widening gap between the two world superpowers, Russia and the USA, and their allies which may lead either to another cold war or international armed confrontation.

Still worrisome is the prolonged Hong Kong protest movement and the open support of USA by way of its Senate resolution allowing visa-free entry into American soil for all arrested protestors.

This is viewed by China as meddling by foreigners in a purely domestic affair and reinforces its suspicion that the civil unrest is CIA-instigated and funded.

The Hong Kong issue and the ongoing trade war could be a flashpoint that might trigger a violent confrontation between our two major trading partners with dire impact on our economic performance. For several months since the start of the intermittent trade war, it has inflicted punishing consequences to our capital market, the barometer of our economy, as the PSE index continues its roller coaster ride.

Adding more worrisome development, the world has been caught unaware when the novel coronavirus (nCoV) from Wuhan claimed more than a hundred lives in China and other parts of the world. The mutating virus is feared to become a pandemic and this has caused travel and the flow of commerce to become severely restricted as a number of governments imposed travel lockdowns.

On the domestic front, the recent eruption of Taal Volcano has led to the forced mass evacuation of almost a million Batangueños and has dislocated lives in the metropolis and southern provinces. Although the alert level has grudgingly gone down allowing most evacuees to return to their homes, there remains an apprehensive uneasiness on the possibility of a bigger and more disruptive volcanic eruption.

All told, these events may have a chilling effect on our countrymen, especially the startup entrepreneurs. Yet on the contrary, businessmen are the most inveterate optimist. I have yet to encounter a person determined to go into business and stop mid-stream from making the plunge for fear of failure.

Even against overwhelming odds, a Filipino business person on the edge of investing his resources will either go through the motion of applying the SWOT (strength, weakness, opportunity, and threat) analysis or use mere intuition to rationalize his investment decision.

Ironically, more than those fleeting events aforementioned, there are still the pestering serious challenges to Philippine businessmen that pose obstacles to doing business, such as the antiquated restrictive and punitive labor code, the over 100 labor bills which are populist and anti-business, the growing militancy of the radical labor groups, and the biased labor justice system.

At this point, it may be redundant but necessary to once again appeal to our policymakers and regulators to temper the anti-employer bias in the rules that they are crafting. What we need now more than ever is to attract additional investments and generate employment for our growing labor force.