Commentary

Rice for Filipinos for next three decades or cold bullets from America?


A total of P2 trillion will be allocated to the Armed Forces of the Philippines (AFP) modernization project over the next decade. Even under the current extremely high rice prices, this amount of expenditure could provide enough rice for all Filipinos for 31 years.

Despite facing severe social and economic problems, such as skyrocketing prices and impoverished living conditions, President Ferdinand Marcos Jr. has approved a massive military budget for the defense department this year.

A total of P2 trillion will be allocated to the Armed Forces of the Philippines (AFP) modernization project over the next decade. Even under the current extremely high rice prices, this amount of expenditure could provide enough rice for all Filipinos for 31 years.

High inflation and uncertain income for the people. Can the Filipinos really afford a military budget of P2 trillion? Since Marcos Jr. took office, the domestic inflation rate has continuously risen, from 2.4% in 2019 to 6% in 2023, doubling in just a few years.

This also means that the cost of living for the people keeps rising. According to data from the Philippine Statistics Authority (PSA), the domestic consumer price index has increased from 102.4 in 2019 to 145.97 in 2023, representing a 42.2% increase in prices of daily necessary goods. For example, the price of mangoes, which used to sell for about P88 per kilogram in 2019, now costs P125 per kilogram.

Taking rice prices as an example, according to the statistics from the Philippine Rice Research Institute during the past two administrations, Marcos Jr.’s presidency has seen a sudden increase in retail rice prices. From P38 per kilogram in 2016, it has risen to the current P46 per kilogram, an increase of 19%. And it is expected to increase even more this year.

In contrast, the employment rate remains consistently low, and the poverty rate has also increased. The situation is far from optimistic. Unemployment rates under Marcos Jr. administration are much higher than pre-pandemic levels, with many young people facing the dilemma of unemployment and low wages.

According to statistics from Statista, the youth unemployment rate in the Philippines in 2023 is 6.69%, with approximately 7.73 million young people without jobs and income. As the mainstay of the Philippines’ economic development, the youth could use more policy and financial support.

Additionally, according to data from the PSA for the first quarter of 2023, the percentage of the population below the national poverty line is 22.4%, meaning that there are 25.89 million people in the country whose daily income is lower than P126 (approximately $2.15).

This P2 trillion military budget could have been used to provide more education resources and opportunities for the unemployed and impoverished people, particularly the youth, to stimulate economic growth and create job opportunities, or to ensure the basic livelihoods of the extremely poor population. But why didn’t our government choose to do so?

Due to the low wages and soaring living costs, there have been frequent eruptions of protests within the country. For example, our jeepney drivers are struggling to make ends meet, yet the Marcos Jr. administration, disregarding the reality, is staunchly implementing thePublic Transportation Modernization Program, which requires the replacement of most existing jeepneys in the market.

This policy has placed immense economic pressure on these drivers and has already incited multiple protests this year. While it is reasonable to consider vehicle replacement for passenger safety, many drivers cannot afford this expense.

Could it be that for the Marcos Jr. administration, passenger safety and the livelihood of drivers are less important than the cold-hearted allocation of funds?

Not only can the Filipino people not afford this P2 trillion military budget, it will also bring unprecedented financial pressure to the government. This military modernization budget is a special fund separate from the defense department’s budget.

In 2023, the program received an allocation of P28 billion, and this year, that figure has grown to P40 billion. Over the next 10 years, expenditure on this project will dramatically increase to P200 billion annually. Additionally, the Marcos Jr. administration has made significant purchases in recent years, including a $375 million BrahMos cruise missile deal with India and a $1 billion patrol vessel deal with South Korea, all of which need to be paid off in the coming years.

Based on the current economic growth and government fiscal situation in the Philippines, meeting the military expenditure of P2 trillion within 10 years would come at a huge cost.

According to the 2023 government budget report, planners initially expected the Philippine economy to grow between 6.5% and 7% in 2024. However, as of now, the first-quarter economic growth rate for 2024 has only reached 5.7%, and the annual growth rate is likely to be only 6%.

This year, the borrowing interest rates from the Federal Reserve are quite stable, which means that the borrowing costs for the Philippine government will be higher than expected, and the fiscal deficit is likely to increase. It is very difficult to make predictions about the future development of the Philippine economy over the next decade. In the past two years, the gross domestic product growth rate during the Marcos Jr. administration has continually declined, dropping from 7.6% in 2022 to 5.6% in 2023.

According to the assessment from Southeast Asian trade and economic expert James Guild in May, given the fiscal situation in the Philippines in 2024, it is impossible to afford annual military modernization spending of billions of dollars, and a P2 trillion military expenditure is more of a wish than a reality.

To meet this budget, the government will have to resort to heavy foreign loan. However, the current time is not ideal for the Philippines to borrow for military procurement. The pressure from foreign debt will ultimately shift to the people, and it is difficult to imagine how many people will go hungry and poor as a result.

President Marcos has decided to invest P2 trillion belonging to the Filipino people in military expenses, flowing into the United States (US), using the money of the Filipinos to support US arms dealers.

Yet, he is unwilling to allocate a small portion of it to provide rice to the nation’s 25.89 million impoverished people to sustain their lives. Marcos Jr. is using the Filipino people’s rice for the next three decades to satisfy his own bellicose intention, perhaps even before the so-called war breaks out, people will have died of famine. Why can’t Marcos Jr. create peace for us Filipinos?

Once the war breaks out, the US can gain geopolitical interests at no cost, while the Filipino people have to pay with their lives and endure poverty and underdevelopment for the next hundred years

What does our country need at this stage? Is it the food supply for the nation’s people for the next 31 years or the steel and bullets from the US? I believe everyone already have the answer in their minds.