Page 62 - Forbes - Asia (October 2019)

The Philippines’ 50 Richest

THE LIST

35.
MICHAEL COSIQUIEN
$250 MILLION S
MEGAWIDE CONSTRUCTION
AGE: 45

36.
WILFRED STEVEN
UYTENGSU JR.
$240 MILLION S
ALASKA MILK
AGE: 57 WEALTH CREATION per person capital stock, that is,

37. Build, Build, Build all the obvious public infra-
structure—roads, airports and
ALFREDO YAO
$235 MILLION T ports—as well as the less obvi-
MACAY HOLDINGS The country needs infrastructure—and ous, such as power and water
AGE: 75 China has the cash to fund it. utilities. The chart (on the next
page) shows how the Philip-

38. BY YUWA HEDRICK-WONG pines fares against other nations.
JOSE ANTONIO At $10,360 per capita in 2015,
$215 MILLION T THE PHILIPPINES’ SHORT-TERM economic the Philippines lags behind virtually every
CENTURY PROPERTIES outlook has dimmed. According to govern- major Southeast Asian economy and is only
AGE: 72 ment data, real GDP growth weakened in the slightly ahead of Vietnam. Between 2000-

second quarter to 5.5%, the slowest pace in 2015, the Philippines’ capital stock per capita
39. four years, while growth in domestic demand rose 18%, the region’s slowest growth rate and
NECISTO SYTENGCO dropped to a sluggish 2.4%. The country’s fis- dwarfed by Vietnam’s 260% increase. Vietnam
$210 MILLION S
SBS PHILIPPINES cal deficit, meanwhile, reached 3.2% of GDP will surpass Philippines soon—if it has not
AGE: 65 in 2018, up from 2.3% in 2016. This downbeat already done so.
outlook, however, masks a deep and potential- China illustrates how an increase in capital
ly powerful reboot of the Philippine economy stock per capita can fuel economic takeoff. Its
40.
P.J. LHUILLIER that could set the country on a stronger and outstanding economic performance over the
$208 MILLION S sustainable growth path for years to come. past 45 years is underpinned by a stupendous
CEBUANA LHUILLIER The game changer is investment, especially rise in its capital stock per capita, which rose
AGE: 74 in infrastructure, and in particular infrastruc- 365% between 2000 and 2015, to $36,000—
ture investment from China. For decades, the triple India’s rate, though only a third of devel-
41. Philippines underperformed compared with its oped countries such as Japan and the U.S. For
EUSEBIO TANCO neighbors in East and Southeast Asia. Foreign development, rapidly rising capital stock per
$205 MILLION 3 direct investment (FDI) was chronically low, capita is a prerequisite for raising an econo-
STI EDUCATION SYSTEM infrastructure inadequate and crumbling, and my’s growth rate. No economy has ever had
AGE: 70
the manufacturing sector underdeveloped. a sustainable takeoff without removing this
The Philippines suffers from congested binding constraint. The Philippine govern-
42.
JOSE MA. ports, overcrowded airports, inadequate rail ment needs to tackle this challenge head on.
CONCEPCION and road connections, and cities choked with There are signs that the Philippines is doing
$200 MILLION T traffic. Weak investment is partly to blame, but just that. Despite the current slowdown, pros-
CONCEPCION INDUSTRIAL so is bureaucratic inertia and weak govern- pects are improving for an investment upturn,
AGE: 61 ment execution. Combined, they have stunted energized by buoyant FDI inflows, which came
infrastructure development, placing a con- to 3% of GDP in 2018, the second-highest in
straint on growth, and significantly, deterring emerging Asia as a percentage of GDP—after ISTOCK / GETTY IMAGES PLUS
expansion of the manufacturing sector. Vietnam. Stronger FDI has pushed overall
SUP TDOWN WXFLAT How bad is the country’s infrastructure? investment to 28.5% of GDP, high enough to
ÌNEW TO LIST 3RETURNEE A good proxy is the estimate of an economy’s support real GDP growth of at least 6%.

60 | FORBES ASIA OCTOBER 2019