ERNESTO M PERNIA, PhD
Secretary of Socioeconomic Planning
2nd Business Intelligence and Data Analytics (BIDA) Short Course
A project funded by the Australian Government
Multipurpose Hall, Asia-Pacific College (APC)
3 Humabon Place, Magallanes, Makati City
February 24, 2020
Good morning, everyone. These are all very young people who will be the future of the agencies that they represent. It is very important that they are phased into this data science, data analytics, and artificial intelligence.
Prof. Emil Bolongaita, Head of the Australian branch of the Carnegie Mellon University;
His Excellency Steven J. Robinson, Australian Ambassador to the Philippines, our brothers and sisters down south, Australia;
Dr. Ma. Teresita Medado, President, Asia-Pacific College;
Prof. Murli Viswanathan, BIDA Short Course Director;
Ms. Milalin Javellana, Program Director, Australia Awards and Alumni Engagement Program Philippines;
Students from ten or eleven institutions of government, professors, ladies and gentlemen;
My remarks for you will be simple. I will not touch on BIDA. You know bida is star. That’s the version of the Spanish word vida, which is life. This course is not just a star, but also the life of the Industry 4.0. I’ll just provide a general and broad context for the BIDA course—why this course, BIDA, is critically important or called for in this age of Industry 4.0.
Of course, it is a no-brainer that innovation drives economic development. A noted economist in the early 1940s Joseph Schumpeter coined the term “creative destruction”—so disruptive technology has its origin already in the early 1940s—to depict innovation as essential in an economy to create value, replace obsolete production processes, and ultimately drive the economy forward.
The Philippines needs to strongly encourage innovation to boost its industry, particularly our lagging manufacturing industry. For example, the country’s production volume index in manufacturing declined sharply by an average of 8.6 percent in 2019 based on the Philippine Statistics Authority’s Monthly Integrated Survey of Selected Industries.
As you may know, the country is massively investing in physical or hard infrastructure through its Build Build Build program. Although hard infrastructure investments are important to provide mobility and connectivity across some national regions, this is not nearly enough if we want to become a globally competitive knowledge economy.
Investing in ‘suprastructure’
Now, I’ll talk about investing in suprastructure, not just infrastructure. Before you is a slide on how we can attain a globally competitive knowledge economy towards inclusive and self-sustaining economic development.
We need to invest in what is called ‘suprastructure’—i.e., quality education for Science, Technology & Innovation (STI) ecosystem. Today is the best time to develop the STI ecosystem given our robust economic growth and wide fiscal space, the latter affirmed by our recent credit rating upgrades of Standard & Poor’s Global Ratings, which upgraded the country’s credit rating to BBB+, the highest in Philippine history. Early this month, Japan-based Rating and Investment Information, Inc. (R&I) upgraded the country’s credit rating to BBB+ also. Fitch Ratings followed through, raising the country’s outlook from stable to positive and affirmed the BBB rating. This means that we have enough room to spend and invest in the country’s future without getting into financial straits or what they also call a “debt trap. “
Innovation Act updates
Last February 7, Secretary of DOST Dela Pena, DTI Secretary Mon Lopez, and I signed the Implementing Rules and Regulations (IRR) of the Philippine Innovation Act, which was referred to by Professor Bolongaita earlier. This is a pivotal step in spurring innovation in the country. A National Innovation Council, chaired by the NEDA, will soon constitute a meeting to develop the country’s long-term innovation strategy. This long-term strategy will be crafted through a whole-of-nation approach. Seven (7) Executive Members of the Council, who will be appointed by the President, will come from the business sector and the academe, particularly the scientific community.
What I envision, in particular is what I have mentioned many times in various fora, is for academics—i.e., scientists and engineers—who can build and work on the supply side of the STI ecosystem. But to make the ecosystem functional and live, there must be demand for what scientists and engineers produce—i.e., the demand on the side of the private sector—business people including industrialists, entrepreneurs, and capitalists. The government’s role, besides crafting the country’s development plan, is to provide the wherewithal (e.g., scholarships for graduate studies, and other types of funding, including funding for Research & Development, ease of procurement of materials for research) for the academic sector, and to foster an innovative, stable, and favorable business climate for the private sector to thrive, as well as catalyze the relationship between the business sector and the academe and the science community.
Given an innovative supply and demand sides or sectors, the STI ecosystem can become vibrant, mature, functional, and self-sustaining. This suggests that there is a need for higher trust and respect between the academic and the business sectors, and among its members. Which is consistent with the objective of the medium-term Philippine Development Plan, namely, “…to lay the foundation for…a high-trust society…” Underpinning, and resulting from a high-trust society is Malasakit in Filipino—or strengthening the social fabric (or, in other words, solidarity)—the first pillar of the Philippine Development Plan 2017-2022.
Solidarity is needed between and among the academic, development partners, private and public sectors—not to mention the citizenry in general—for our country to achieve the objectives of the Philippine Development Plan 2017-2022 and ultimately, the goal of AmBisyon Natin 2040.
What remains to happen is a trilateral substantive gathering of members of the different sectors – members of the government, the private sector / businesses, and the academe–which is needed to make the National Innovation Council of the Philippine Innovation Act. I would like to strongly suggest that such meetings be held periodically, if not frequently as needed.
Knowledge Management in NEDA
Internally, we in NEDA, as the highest economic planning agency of the country, recognize the importance of investing in knowledge capital that will enable us to make well-informed, evidence-based decisions, as we steer the country’s economy and provide high-level advice to policymakers in the legislative and executive branches of government.
In fact, several bills have been filed in Congress to strengthen planning and knowledge management in the country.
In particular, the latest version of the NEDA Bill pending in Congress mentions the establishment of a repository of information concerning the Philippine economy and its development, which will maintain, and make information and documents available to the public for the purpose of knowledge sharing. This will help ensure coherence and continuity of long-term, medium-term, and short-term development plans and policies even with changes in political administrations.
The paradox of progress
With “creative destruction,” some individuals are likely to be worse off than others. You guys, in this course, armed by your data analytics acumen and training, might unintentionally displace some people in the workplace who could only perform basic spreadsheet operations. As my friends from the Philippine Institute for Development Studies (PIDS) say, the era of new globalization, characterized by volatility, uncertainty, complexity, and ambiguity (or VUCA), is best answered by a different set of VUCA as well – which means, vision, unity, consultation and adaptability. What we in the government have to do then is to provide support to displaced workers. One possible way is to make training available to help workers adapt to changing times. As Ambassador Robinson mentioned, change is necessary but it is uncomfortable to many usually, so people tend to do what they are used to be doing. But change is inevitable and we have to adapt to change. In the US and other countries, I think some are even floating the idea of a Universal Basic Income. I hope to tackle this with the Council.
At this point, I would like to thank and congratulate Dr. Emil Bolongaita and the rest of the Carnegie Mellon University in Australia team for being the energy, the imagination, and the force behind this BIDA course; Ambassador Steven Robinson, our big brother and sister down south, so generous to us and in fact, I am told that they are thinking of helping us build a Data Science Institute, so that will really be a big boost to our ambition to become a knowledge-driven and globally competitive economy. To Ms. Milalin Javellana and the people from Australia Awards for giving primacy to education and for making the partnership with Asia-Pacific College happen for this course; Dr. Ma. Teresita Medado, the President Asia Pacific College for trailblazing this path of partnering with global educational institutions, which the other colleges in the country should envy and try to emulate. In fact, we now have the Transnational Higher Education Act, which should enable more partnerships like yours in the country towards a vibrant STI ecosystem.
I call on everyone present today to work with us as we try to reach our development goals in the era of the new globalization, characterized by volatility, uncertainty, complexity, and ambiguity. I urge the students, in particular, to unleash your creativity, and imagination to use them as tools to fill in the policy-making gaps. This is really not much creativity needed there. The work for change needs to be untiring and relentless.
Let me end with the Latin phrase, “Semper Parati, Semper Ad Meliora” – meaning “always prepared to move towards better things.” We must work together in empowering and uplifting lives of our people, leaving no one behind and forsaken. Each of us is connected in the achievement of a strongly rooted, comfortable, and secure life for all.
Thank you very much, and a pleasant morning again to all of you.