Crossroads (Toward Philippine economic and social progress)
Philippine Star, 18 September 2013


Political tensions – both domestic and international – create added uncertainties to our economic world. They often bring about new dimensions to the problems and circumstances that we face. In particular, I refer to factors that are hardly economic but which sometimes affect the way we perform or work.

International tensions. Recent tensions in the Middle East – in particular, last week, the developments in Syria – have temporarily disturbed world international markets. These have died down somewhat after later developments have changed the course of things to come. This just goes to show that uncertainties come and go and then revisit us in different forms.

I have in recent columns pointed out that the energy consequences of the Middle East political tensions are less important today than they were in the past. That is true for world supplies of energy – for there are newer sources and they are in fact expanding in future volumes especially for the long run. Also, trade supply routes to and from the Middle East are less worrisome today, again both from an energy viewpoint and from a world perspective.

In the specific case of the Philippines, however, there is much more sensitivity to the Middle East developments. One reason is that Philippine imports of crude and energy are still highly sourced from that region. Such is specifically true in the short run period.

The growing geographical dispersal of the world’s energy supply map is helping out to modulate the potential harm that could happen among all countries dependent still on Middle East energy supplies. But short term developments that change the political power relations in that region could create immediate short-term spikes in energy prices that could harm all in the short run.

Syrian crisis. As long as the political problems of the Middle East countries remain internal to them, they have minimal if no impact on our own economic affairs. But those tensions become a potential fireball when the big powers get sucked up directly into their problems. Then that fireball gets transmitted to affect world economic markets, first, and then to us.

Just two weeks ago, when US President Obama had threatened to strike Syria’s Assad regime for chemical attacks on its citizens, the world’s economic markets got rattled. The tension considerably eased however when Russia persuaded Syria to agree to bring its chemical weapons stockpile under international control.

The US strike became a paper tiger when, as it turned out, Obama’s decision to seek Congressisonal backing began to face strong resistance and possibly certain defeat. Thus, when Vladimir Putin, the Russian president, persuaded the Syrian government to agree to put their chemical weapons under international control, the way toward a diplomatic solution was paved as a preferred route. Hence the tensions eased.

The Syrian civil war is likely to continue its disastrous course as an internal problem among its own people. The outcome is still unknown, but if it continues its present course, the upper hand appears to be in Assad’s favor. Thus, he could win the civil war. Such a war, however, appears to be a proxy war among various stakeholders that involve other third nations. It is not a guarantee that the US will not be involved into any further entanglement, if only to assure that it protects its own national interest in the region.

Among the other countries in the Middle East that are threatened by political convulsions as a result of the Arab Spring uprisings are the political dramas that are still fluid in their outcomes. As we watch such dramas, the search for the right solution becomes ever more elusive. In many countries, there is great discontent. The more their governments search for new solutions, the more they use old-time remedies. Hence, in Egypt, the government is now firmly again in the control of the military.

Of course, as distant outsiders, we in our country are helpless bystanders in these national dramas. Their outcomes lead simply to greater uncertainty about the future.

The nuclear proliferation problem. For the moment, the nuclear proliferation problem for smaller powers is resting from world headlines. This is only momentary. The Iran problem concerning the suspected building of nuclear bomb capability is currently in the backburner. This problem is likely to bring high tensions as the issue resurfaces again soon.

Iran’s nuclear program is currently overshadowed by that country’s recent election of a new leader who appears to be a moderate. Such outcome might reduce the high tension that this has caused just recently. The new leadership of Iran is just being given some space to settle in his new job before being tested.

The proliferation of nuclear weapons is more dangerous than that of chemical weapons simply because of its more destructive power. In the Middle East, any nuclear weapons race could escalate tensions at a world level.

The less distant case of North Korea’s nuclear ambition is another point of concern. The young leadership of that country has proven to be as problematic as the one that preceded it. That could reignite the Korean war tension.

Domestic war: the MNLF. More disastrous to the Filipino nation simply because it is in our own territory is the outbreak of hostilities that MNLF (Moro National Liberation Front) discontents brought upon the city of Zamboanga last week. This is happening even as the peace process involving the MILF (Moro Islamic Liberation Front) and the government is reaching a climactic stage.

The MNLF attack is a reminder to us that the country’s Mindanao problem is complex. There is clearly a political problem among the Muslim groups representing various parts of the Mindanao area. As long as factions exist that divide them, reaching a peaceful settlement with the government will be elusive. Any agreement with a group could become reason enough for new factions or groups to raise their separate grievances and wage a war with the government.

Mindanao has so much economic promise in raising the nation’s productivity. A murky peace and order problem will reduce the possibilities of lasting and uninterrupted development based on the peace dividends.