Business and Society

The economic impact of the hostage crisis

By BERNARDO VILLEGAS
September 5, 2010, 11:53am

Every decent person--no matter what his or her nationality--should condemn in no uncertain terms the ineptitude and insensitivity of some police personnel, media people and ordinary citizens during the August 23, 2010 hostage crisis in the Luneta. No one questions the heroism of some of the police who risked their lives in trying to rescue the hostages. But heroes can also be stupid and incompetent if they don't use the appropriate skills and instruments in effecting the rescue. No one questions the noble intention of some media people who wanted to inform the public of what was going on during the rescue operation. But the search for the truth should be tempered with the virtues of prudence and concern for the lives of the victims. There is nothing positive I can say about the onlookers whose only motivation in the scene was plain curiosity. They had no right to turn the whole sordid affair, together with a few senseless media people, into a carnival or circus. No decent person entertains himself at the expense of human lives at risk of death or injury. You do that only with bulls or cocks. Even bullfights are now being outlawed in key Spanish cities.

We should, however, view this tragic affair with a great deal of circumspection when talking about its long-term impact on the economic welfare of 90 million Filipinos, both those residing in the Philippines or are working abroad. We should avoid the knee-jerk reactions of those saying that tourism this year will significantly suffer because foreign tourists will stop coming to the Philippines.

First, let me remind those in the tourism industry about what happened during the worst months of the global crisis of the last two years. When there was a drop in the numbers of even South Korean tourists in such destinations as Cebu, Boracay, and Panglao, the occupancy rates of hotel did not suffer a large decline because domestic tourists took their place. Remember there are anywhere from 10 to 15 million Filipinos who have enough income to indulge in domestic tourism.

Second, my personal experiences traveling to Indonesia in the last two years have convinced me that the memories of foreign tourists can be quite short. I was in Jakarta when some suicide bombers attacked two five-star international hotels where top executives were meeting in breakfast fora. These bombings resulted in the death or injury to very prominent multinational CEOs and other executives. A month later, I went back to the same hotels and everything was normal and the CEOs were once again holding their breakfast fora in the very same places that were bombed. Of course, the security was tightened significantly. That is why I believe that the negative impact on foreign tourist arrivals will be very short-lived, especially if our tourism industry officials in both the public and private sectors will be very proactive in marketing the attractions of such places far away from Manila such as Palawan (where there are 2,000 islands), Bohol, Dumaguete, Camarines Sur, Camiguin, Laguna, Oriental Mindoro, Samar, Davao, and many other sites which have become more accessible thanks to the Philippine Nautical Highway and improved airports (such as those in Iloilo and Bacolod).

Those who are fearing a big drop in the deployment of our OFWs because of this unfortunate display of ineptitude and incompetence on the part of some of our public officials should be reminded of what happened in 2009. At the beginning of last year, high officials from the World Bank, IMF and other international agencies predicted an economic recession in the Philippines because of the expectations of a large decline in OFW remittances resulting from the Great Recession. What happened was exactly the opposite. OFW remittances increased by close to 6 percent and reached a record of almost $18 billion dollars, helping the Philippines avoid a recession. As I reported in previous columns, some segments of the OFW sector experienced increases of remittances of as much as 27% (the Filipino seafarers). My two-year residence in Barcelona, where there are some 30,000 OFWS, convinced me that Filipino workers abroad are the first to be hired and the last to be fired because of their special qualities of giving tender and loving care in such personal services as care-giving, waitering, nursing, homemaking, etc.

That is why, despite the very understandable fury of the 80,000 indignant residents of Hong Kong who protested against what they perceived as incompetence of our government officials, I feel confident that they will not condemn the OFWs in their midst and will take them for the invaluable services they are rendering in their homes as care givers for the aging and homemakers as well as child care assistants. From my personal knowledge of the ordinary Hong Kong residents, I am convinced that the vast majority of them reflect the views of Carl Chui, a 20-year-old university student in Hong Kong, who was reported to have said during the protest rally against the Philippine government: "My feelings toward the Philippine people haven't changed. This is not a problem concerning the entire Filipino race."

I suggest to the leaders of associations of OFWs in Hong Kong to advise their members to counteract the temporary disillusionment of their employers with Philippine government officials by being more caring and gentle in their dealings with the people of Hong Kong. They can demonstrate what is obvious: the sins of a few government and media officials in the Philippines should not be taken against Filipinos in general, especially the OFW community in their midst. There will always be a few of these OFWs who may stain the reputation of Filipinos by stealing or committing other crimes against employers. But the experience in the close to 100 countries all over the world where there are OFWs is that the overwhelming majority of Filipinos working abroad are well known for their virtues and humanitarian values. In fact, this is the feedback I got when I met the OFW community in Seoul, South Korea yesterday, September 5. There and elsewhere, Filipino workers always benefit from comparison with other nationalities.

The Philippine economy will not suffer from any significant decline in revenues from tourism or OFW remittances as a result of the Luneta tragedy. Together with a significant increase in both local and foreign investments in the remaining months of 2010, the consumption-led recovery from these two important sectors, i.e. tourism and OFW remittances, will contribute to a continuation of the 7% growth of GDP that we already experienced in the first semester. Over the medium term, I hope the lessons from this crisis will result in a more competent police force and a more socially responsible media. For comments, my email address is bvillegas@uap.edu.ph.