[In This Economy] Financial dangers of a Sara Duterte presidency

Sara Duterte’s announcement that she is working for president in 2028, unusually early even by Philippine electoral requirements, is clearly a transfer designed to dominate the narrative, freeze out rivals, and mission inevitability.

Admittedly, she’s faring properly within the polls, and she or he’s leveraging on this truth to mission energy — at the same time as impeachment complaints are piling up, at the same time as her father awaits trial in The Hague, and at the same time as lots of her father’s closest allies, like Senators Bong Go and Bato Dela Rosa, have been explicitly named by the Worldwide Felony Courtroom (ICC) as “co-conspirators” within the drug warfare.

However right here I wish to discover what a Sara Duterte presidency would possibly imply for the Philippine governance and the financial system, given her personal observe report.

Mayor and vice chairman

Let’s begin along with her stint as mayor of Davao Metropolis. After the decades-long rule of Rodrigo Duterte, Sara inherited a well-oiled dynastic machine that rotated posts in her household to strategically circumvent time period limits. Again in 2025, she mentioned she’d help an anti-dynasty legislation, however in reality the Duterte dynasty expanded after the Could 2025 polls.

As mayor, Sara additionally acted with an iron fist — actually involving a fist, within the case of bodily assault on a courtroom sheriff in 2011. That act, which was caught on tape and she or he publicly admitted to, is symptomatic of Sara’s consolation with coercion as a first-resort device and a willingness to subordinate authorized establishments to non-public authority.

These instincts, if scaled to Malacañang, might have actual penalties for the rule of legislation, contract enforcement, and institutional predictability. Her report suggests a governing fashion that prioritizes coercion over institutional restraint.

Sara Duterte’s time as vice chairman solely deepens these governance issues.

The confidential funds controversy on the Workplace of the Vice President and the Division of Schooling was not merely a political scandal but additionally a window into how she views checks and balances and financial oversight. Civilian businesses comparable to these usually are not imagined to have giant, opaque intelligence-style budgets. By the appears of it, Sara has no actual concern in any respect about fiscal accountability, nor an understanding of the idea. This issues enormously given the funds scandals of late, and amid power deficits and debt.

As well as, she’s been basically silent about allegations of P51-billion value of flood management initiatives pushed by her brother, Paolo Duterte, who was a consultant of the 1^st District of Davao Metropolis within the 18^th Congress. The radio silence on this difficulty is unsettling, and it means that efforts to pursue official funds reforms and curb budget-related corruption will possible come to a halt underneath one other Duterte presidency.

Throughout her stint as schooling secretary, the image is equally troubling. The Philippines entered the Marcos Jr. interval with a extreme studying disaster, with worldwide check scores of our college students among the many worst globally, pandemic-era studying losses compounding a long time of underinvestment, and a instructing workforce that wanted severe structural reform.

Sara produced no coherent learning-recovery technique. In an financial system the place human capital is the driving force of long-run productiveness, that omission is economically consequential.

Recall that she initially wished to get the put up of protection secretary, and early in her time period within the Division of Schooling (DepEd), she held conferences with police and navy personnel contained in the DepEd compound. Then she pushed for a half-baked “Matatag Curriculum” whose rollout lecturers known as “chaotic.” Sara got here and went, however she made no actual adjustments in DepEd.

Financial prospects

What would a Sara Duterte presidency possible imply for the Philippine financial system? I predict a return to the political-economy situations that made the Rodrigo Duterte years so damaging, however along with her personal taste of unpredictability layered on prime.

Headline macroeconomic numbers held up within the early years of Rodrigo Duterte’s presidency, partly by inherited development momentum. However institutional erosion accelerated beneath, and this inevitably spilled over to the financial system. The drug warfare, as an illustration, frightened overseas observers and potential traders, and consumed sources and coverage consideration that ought to have gone towards infrastructure high quality, competitors reform, and human capital formation. (READ: Oligarchs, taxes, POGOs: Large enterprise and the financial system underneath Duterte)

Rodrigo Duterte’s most severe financial failure was not a single unhealthy coverage however the regular degradation in governance: the weakening of checks on government energy, the politicization and militarization of impartial businesses, and the normalization of opacity that makes sustained excessive development structurally more durable to realize. Due to these governance failures, the pandemic response was botched and led to the nation’s worst postwar recession and the worst downturn in Southeast Asia.

Sara’s report suggests she would proceed that trajectory, not appropriate it. She has made no severe reckoning with the institutional and financial injury of 2016–2022. Her messaging emphasizes order, loyalty, and self-discipline. That’s the vocabulary of authority that his father espoused.

Thus far, she has additionally mentioned nothing of actual substance in regards to the Philippines’ precise binding growth constraints, like bottlenecks in infrastructure, logistics, and rules; the price of electrical energy, which stays among the many highest in Asia and is a direct tax on manufacturing competitiveness; competitors coverage failures that maintain oligopolistic rents throughout utilities, transport, and retail; and flagging human capital formation.

These are among the many structural issues that specify why the Philippines constantly underperforms its regional friends on manufacturing employment and productiveness development. A president with no coherent financial technique doesn’t encourage confidence, and even poses an actual risk to our development and growth prospects.

A Sara Duterte presidency would nearly actually generate the identical investor wariness her father’s did: not essentially capital flight, however a better danger premium, a hesitation, a choice for waiting-and-seeing that exhibits up ultimately in financial statistics. In sensible phrases, that may present up in slower capital formation, a decline in overseas direct investments, and poor job creation. We already noticed a few of this throughout her father’s time, and the very last thing we wish is a repeat of that.

There’s additionally the exterior issue. Below Sara Duterte, Philippine overseas coverage will possible tilt in favor of China once more. This carries robust financial implications: heightened geopolitical danger within the West Philippine Sea (hurting our potential to discover the area and expend the pure sources there), investor confidence, and long-run strategic positioning in regional provide chains.

To sum, as early as now it’s straightforward to see {that a} Sara Duterte presidency may have large financial and social impacts. I’m notably nervous about our financial system. Within the run-up to 2050, insurance policies ought to be specializing in boosting studying competencies, lowering the prices of doing enterprise, pursuing sustainable vitality, and so forth. But when we make the identical errors as earlier than, we are going to descend headlong not simply right into a repeat of authoritarian populism and institutional erosion, but additionally extra years of financial malaise. (Funnily, Sara Duterte’s announcement of her presidential bid got here on the identical day I used to be discussing the financial affect of “nation danger” in my macroeconomics class.)

The Philippines got here out of the pandemic with an actual alternative to reset its development trajectory. That chance is narrowing with each election cycle that produces in poor health outcomes. The best way I see it, our financial system, broken sufficient as it’s, received’t survive Duterte 2.0. – Rappler.com

Dr. JC Punongbayan is an assistant professor on the UP Faculty of Economics and the creator of False Nostalgia: The Marcos “Golden Age” Myths and How one can Debunk Them. In 2024, he acquired The Excellent Younger Males (TOYM) Award for economics. Observe him on Instagram (@jcpunongbayan).

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