Online Extra: Q&A with Former President Fidel Ramos

On new President Gloria Macapagal-Arroyo: She has the genes...the academic titles...and the administrative experience

The final success of the People Power 2 protests that led to the ouster of Philippine President Joseph Estrada and swearing in of Gloria Macapagal-Arroyo, owed much to the support of former President Fidel Ramos, who took to the streets and helped marshal key backing from the military. A former general and graduate of West Point, Ramos provided some unique insights on the challenges facing Arroyo as President in an interview with BusinessWeek Asia Correspondent Frederik Balfour on Mar. 2. Edited excerpts from their conversation follow:

Q: What credentials is Arroyo bringing to the office?


Her credentials are much better than mine. I have three Master's degrees, but she is very well educated. She has a PhD in economics from the University of the Philippines and a Master's in management economics from Georgetown University. She was Undersecretary of Trade & Industry, and a senator for six years before going for vice-presidency. Of course, she is well known as the daughter of a former President. She has the genes, she has the academic titles, and she has the administrative experience.

Q: As a former President, what insights can you provide on the personal sacrifices needed in this job?


The President of the Philippines I used to liken to a juggler balancing 10 balls in the air, which are the primary issues pertaining to economic growth, our national security, and our social reform. But the President is not on the ground juggling those balls. [He or] she is on a high wire 100 meters up, and [he or] she must not fall down, otherwise the country will go down with him or her. But on the high wire, the President of the Philippines is not on his [or her] feet, [but] on a bicycle -- that's how difficult this job is. Besides, this is a very freewheeling democracy. We threw out dictator [Ferdinand] Marcos in 1986. The people have high expectations of their leaders -- if they don't perform, the people can remove the elected President, as was demonstrated just over a month ago.

And so the President must stay on the job all hours of the day and night, eight days a week. If the President leads by example, with a simple and productive lifestyle, a steady work ethic, the rest of the officialdom will have to follow, and the people will be inspired by the President. This is the theory. The practice is something else. I have no doubt that President Gloria Macapagal-Arroyo can do the job well.

Q: What legacy has she inherited from Estrada?


A huge budget deficit and very little confidence yet on the part of the international investor community toward the Philippines. We hope that with everybody pulling together under her leadership, we shall be able to overcome that lack of confidence of the international community, as well as our own capitalists and businessmen.

Q: What message is most important for the administration to put out?


The Philippines is back in business under a new leadership, in the center of the action in the Asia Pacific, which is again growing with greater momentum and better prospects in the next four or five years.

Q: How long will it take to turn the economy around?


The downward spiral of the peso, the stock-market index, and the budgetary deficit were the main indicators of a very, very serious decline in our economic condition. Some are saying that within the next one and a half years we should be able to reach a growth rate of 4% to 4.5%. This will take quite a bit of doing, starting with the improvement of fiscal performance, collection of taxes, customs duties, and austerity programs, without sacrificing the need to modernize our infrastructure.

There is also the need to finally put our peace process in Mindanao back on track, because that has been derailed during the time of Estrada. It is important to us, because one-third of our population lives there, and it is also the main component of the Malaysia, Indonesia, Brunei, Philippines East Asia growth area, with a market of 45 million people. We also need to revive our investment momentum in the special economic zones, like Clark and Subic and parts of northern Luzon.

Q: How effective will the new President be in stamping out corruption?


It's not just the President, [but] she must take the lead and show strong leadership and political will. One mechanism I created in 1993, [which was] dissolved during Estrada's time -- the Presidential Commission Against Graft & Corruption -- is back. Also there is the ombudsman to go after public officials who might be involved in or suspected of graft and corruption.

The corporate world here is also very aware of the need to improve their own way of doing business, which must be as graft- and corruption-free as possible, because that is the only way now that any country, any economy, can be attractive to outside investors -- to have a so-called [level] playing field and transparency and accountability in place at the same time. After People Power 2 removed Mr. Estrada, the citizenry, the civil society, is much more aware of the need for efficient, responsible, and productive public service.

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