Modernization of the Armed Forces of the Philippines (AFP) has been the all-encompassing dream of every president since Ferdinand Edralin Marcos.
A strong and modern army can only be organized, trained and maintained by a country which has a robust and growing economy and enough resources for its internal and external defenses.
It is a fact that the Philippine economy has floundered for so long and has had to survive major global economic upheavals such as the oil crisis of the 1970s, the debt crisis during the Marcos-Aquino transition, the Asian financial crisis of the FVR era, and the succeeding stock market, property and banking collapse in the US, and finally the Covid-19 pandemic, the Russia-Ukraine war and their inflationary impacts on the Philippines. These economic problems, most of them global and with possible solutions beyond our reach, have conspired to pressure various Philippine administrations to fund social services first, relegating defense spending to a non-priority.
It was only when President Fidel Ramos took the helm of government that the soldier in him prodded him to take action on AFP modernization, and his easy answer was to sell military lands to private corporations to buy fighter planes, helicopters, artillery pieces, heavy tanks and mechanized guns, and floating assets for the Navy.
This move gave the government net proceeds to buy these military stuff, although just like other official transactions, a big portion of the money went to graft and corruption, or legal but bloated commissions.
The FVR solution made a dent, somehow, but the present geopolitical realities absent during his time necessitated more military strength both in personnel and equipment.
This is the rationale for Defense Secretary Gilberto Teodoro Jr.'s call on enterprise executives and managers to help the national government in crafting "creative financing solutions" to help ease the financial burden of the AFP's ongoing modernization program.
Teodoro made the call in a speech before members of the Management Association of the Philippines (MAP) on Wednesday. While the AFP modernization has high funding requirements, the government has to balance the economy and the spending for infrastructure, social services, education, and various other priorities.
“We need to find off-budget, non-traditional financing sources for modernization but not on the model of the old BCDA, where land was traded for modernization. Therefore, I ask your help for creative financing for us where we can spread out the terms of whatever financial arrangements we can make to limit the size of amortizations that the national government will make to make it more palatable,” Teodoro stressed.
The DND chief also expounded on the need for resources to build up the country’s defense posture amid “geopolitical problems worldwide” such as the situation in Ukraine, the Red Sea, and the tensions in the West Philippine Sea that “have affected the business cycles in the Philippines” and “caused some lack of confidence in the geopolitical stability of the region.”
While the participation of the private sector in modernizing the country's defense establishment may be a patriotic move, businessmen still have to ask if there is money to be made in what Teodoro is proposing. Business, after all, is there to make money. If profits can accrue to this endeavor and service to the nation is rendered as a result, then Gibo Teodoro's sales talk will have some takers.
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