Posted on 2007

Annual Convention of Chamber of Thrift Banks
Ballroom A, Dusit Hotel Nikko, Makati City

I must say that the theme you chose for your annual gathering is a most welcome one. It speaks not only of the Chamber of Thrift Banks positive outlook but also of its resolve in braving the odds to help the economy move forward.

You and I know that in recent months, the posturing of the administration is that the economy is growing. This has in fact given the administration something to boast about. They have even challenged those running against them to a debate. We all know that the stock exchange and the exchange rate is the weakest indicator that will tell us if indeed the economy is in a growth path…if these are the only indicators they can boast about it is a wobbly growth path…limping and ready to fall down any minute.

If indeed the economy is growing as they say it is, I do not need a debate to ask them this question… if the economy is indeed growing, in whose terms?

In recent years, our economy has indeed been described as fostering jobless growth. Simply put, even in times of supposed improvements in our macroeconomic fundamentals, the growth does not produce jobs that can absorb new labor entrants. While an average of 896,000 workers entered the labor force annually from 1993 to 2005, there were only 758,000 jobs created by the economy during the same period. As a result, more and more Filipinos turn to overseas work to earn a living. According to the Philippine Overseas Employment Agency (POEA), there are more than 8 million Filipinos overseas today. That makes 1 in every 10 Filipinos an OFW.

We need an alternative development strategy. To my mind, we need to create a nation of entrepreneurs. We need to enable Filipinos to get out of their comfort zones and be risk takers. We need a generation of wealth creators. We need to educate Filipinos that being a lifelong employee is not the only option.

This is where thrift banks’ role come into play. As prime movers in the Small and Medium Enterprises (SMEs), I look at you as catalysts that can launch a culture of entrepreneurship in the country. Thanks to the Thrift Bank Act of 1995 as it enhanced your mobilization of small scale deposits and extension of credit resources to individuals and SMEs and in the provision of housing loans.

My dear friends, SMEs employ 70 percent of the country’s labor force. SMEs represent success stories of dreams realized, of visions fulfilled.

The story of Mr. Teodulo Bergado is particularly inspiring. After working in Saudi Arabia and the USA, he put his stint in a water treatment company to good use when he put up an ATM initially in Taguig. No, his ATM is not the automatic teller machines. It is an ‘automatic tubig machine’. It does not pour out cash but safe, clean and affordable water at P5.00 per gallon, catering to class B and C customers.
Like the bank ATM’s, it is self-service. It is however coin operated thanks to Bergado’s ingenuity. DTI assisted Bergado through the Small Business Guarantee and Finance Corporation which granted him a loan of P1.4 million. As of today, ATM Ber-Aqua as the business has since been called, has assets of P4.3 million according to the DTI. Water stations have also increased and can now be found in Valenzuela, Pasay, Pampamga and Bicol. What is remarkable is that it has inspired five more entrepreneurs to take on a similar path as they were awarded franchises by ATM Ber-Aqua.
Mr. Bergado’s journey is a testament to the Filipino ingenuity. But I guess we are all too familiar with his story because Bergado’s story is yours and mine too. Sipag at Tiyaga, is the story of my life, of our lives. Yes, if we made it, we can make each and every Filipino believe that he can be a master of his own destiny and not rely on government dole-outs or attend paid rallies.

If lucky enough to be elected for another six-year term, I will craft policies that will encourage the growth of SMEs in the country from the more than 800,000 SMEs listed according to the latest DTI count. Their productivity should also be increases to be at par with other Asian countries. While Philippine SMEs contribute 32 percent to the country’s Gross Domestic Product (GDP), China throws in 60 percent while Indonesia puts in 63 percent.

The government is very well aware of these problems. In 2002, Congress passed Republic Act No. 9178, otherwise known as the Barangay Micro Business Enterprise (BMBE) Act which I authored. This measure promotes the establishment of BMBEs by providing various incentives and benefits to entrepreneurs.

Thrift Banks should also look at other innovative ways to maximize its capacity to improve people’s lives. Not only do these banks promote entrepreneurship but it can help in financing socialized housing for the benefit of our nation’s people.

With the population growing at an annual rate of 2.32 percent, demand for shelter is also expected to increase. Given this, government policy makers are bent on providing more shelter assistance and pursuing strategies to encourage more private sector participation in housing production. In fact, “jumpstarting” the housing construction sector is likewise seen by government as a major economic growth contributor that can help poverty alleviation efforts. In terms of geographical location, 52 percent of this housing need can be found in Regions III and IV and the National Capital Region; the Visayan and Mindanao areas, meanwhile, own 21 percent and 23 percent, respectively.

According to the Medium Term Philippine Development Plan (MTPDP) 2004-2010, housing need in the country is estimated to reach a total of 3.75 million units by 2010. Demand for new houses, for the said period, is 2.6 million of the total while housing backlog accounts for almost a million.

I see this as an opportunity and a challenge for the Thrift Banks and the government to collaborate in order to create houses for the poor and to create economic growth for our country. It is important to stress out that if we work hand in hand in pursuing this then we might just see a better Philippines in the next couple of years or so.

According to a great American leader “There are risks and costs to a program of action. But they are far less than the long-range risks and costs of comfortable inaction.” – former President John F. Kennedy. Again I reiterate that this is an opportune time for us to take action for the benefit of the Filipinos. Sigurado naman na makukuha natin ‘yan sa Sipag at Tiyaga.

With this, let me end by thanking all of you once again for inviting me to break bread and share with you my thoughts on this gala dinner. Again, I call on you to work hand in hand with me and the government to create a generation of entrepreneurs.

Good day to you all!

Maraming salamat!

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