Angara Senate Speech Extending COMSTE
Dear Colleagues in the Senate,
As you know, we started the COMSTE last year, and as of October, the panels of experts that we appointed have already completed their evaluation of where we are, and their strategic recommendations of where we should go:
- in food and agriculture;
- in energy and environment;
- in IT and IT enabled services;
- in health;
- in semiconductors and electronics; and
- science, math and engineering education.
While already substantial, their work has just begun. They have compiled their recommendations, but details and costs still need to be worked out. They need to finalize their recommended bills and measures, and also go on public consultations with key stakeholders and the Science & Technology community as well.
We tend to equate science and technology as a topic that we can relegate to the backburner.
We think sometimes that it is not as important as the other issues we are pursuing. Little do we realize that S&T has a direct impact on our economy. Our biggest exports are in electronics, and a major employer right now is the IT outsourcing sector. We can also expect significant job creation in the energy sector, especially in clean energy. Needless to say we need to work on food and health.
Today we live in uncertain times. While domestically, we have immersed ourselves in issues related to politics, the cloud of doubt brought about by the financial crisis has grown darker. A few months ago, we were hit by the food, and then the fuel crisis, and then the subprime mortgage crisis of Wall Street.
Now the U.S.-originated crisis has spread and spilling over to the rest of the world. Already, the attrition has begun. Citigroup just announced that they will layoff 50,000 people, companies in Silicon Valley have started to issue earnings downgrades and layoffs, retail stores like Macy's and Best Buy are having difficulty. Circuit City, another retail store for electronics has declared bankruptcy, and even the US automotive giants like GM, Ford and Chrysler are now seeking a bailout from Uncle Sam as they may go bankrupt by yearend. And this is just the US.
We have, for many decades, not kept up with the pace of investments needed to match what our neighbors have put in. Just recently I was in Shanghai talking to the top energy venture capitalists and investors, and with this new half trillion dollar stimulus package by China, it may possibly signal the new role of China in the region. There is a lot of capital out there just waiting in the wings, and if we position ourselves correctly, we can attract a lot of Foreign Direct Investment here, something that in recent years, Vietnam has already overtaken us.
Now I would like to link what all these events happening outside our shores to our own domestic situation. We may think that our economy is not S&T dependent, but in reality, it is very S&T dependent. Take for example the electronics and semiconductor sector which employs around 300,000 people directly not counting the indirect employment it generates, and the $31 billion a year worth of exports it generates. Remember I talked earlier about the weakness of the retail stores in the U.S.? This means that people are not buying; they are too distracted by foreclosures, and so the last thing on their mind is to buy new iPhones or new computers. And with less orders for products, the need for customer support activities like call centers may be affected. So all of these things can significantly affect not just big business but also the ordinary employee on the street, and his plans. Negative news in New York or London or Tokyo can mean plant closures in Baguio, in General Trias Cavite, or elsewhere.
So if the orders to our export factories here are being cut, our workers will be laid off or at the very least their work schedules may be cut back significantly. This is a serious problem, but it can also be good opportunity for us to retool and retrain our industries. If the government can forge a coalition, a private-public partnership, we can work together to strengthen this industry, so that when people realize that they eventually have to purchase new computers and new cellphones, the manufacturing orders will go not to China, or to India, or to Vietnam, but to the Philippines.
So this is where the COMSTE will step in. By working closely with industry in sectors like electronics or IT, government can be instrumental in making our industries and sectors more competitive. For example, one of the things we are contemplating is to implement a bridge training program, so that even if the electronics industry decides to implement a shorter work schedule, the workers can improve their skills. Once the industry recovers, it will be stronger and more vibrant.
It is this mindset, this long term and strategic partnership between government and the private sector, that I would like COMSTE to make a difference in. In COMSTE, we have members from the private sector, so it institutionalizes the concept of a public-private partnership, something we do not see a lot of in this country. The new strategy is not for government alone, or for industry alone to do it. We have to do it together.
COMSTE will be effective and significant because we are working on both the source, which is education, and the destination, which is the industry sector. By fixing the source of our well trained graduates – school system – we are able to give industry what it needs – a strong and capable workforce. An example, the COMSTE education panel has recommended the creation of a science section in each of our public high schools. This will generate the critical mass of students who will consider careers in S&T.
By the same token, COMSTE, by working with the various sectors will give the students who pursue S&T courses a good career option, instead of just allowing them to graduate and then leave for jobs abroad. COMSTE aims to create opportunities for S&T workers, by encouraging entrepreneurs to create jobs and encouraging investors to put money in these new ideas. It will also create opportunities for our balik scientists to come back and possibly setup new technology companies here. A month ago I met, in Washington D.C., with some of our brightest Filipino scientists in the U.S. They are keen to help, but they are just looking at ways how they can do that.
Two ways that COMSTE will do to create opportunities are two proposed bills, namely a Fair Access to Capital bill for technology entrepreneurs, and a Human Capital Development bill. The Fair Access to Capital bill seeks to correct an imbalance in the availability of capital for science and technology entrepreneurs who normally do not have physical collateral but instead have intellectual property. The Human Capital Development bill, that will come in when the PEZA and BOI incentives expire, seeks to replace blanket incentives with some incentives that have to be earned by companies. The companies can earn these incentives by investing in the training of their workers.
I will not enumerate today all the recommendations of the different panels, but if I can spell out the big picture, let me do it in this manner. COMSTE seeks to create a bigger pool of S&T professionals from our public schools and universities. Therefore we need to upgrade those schools and universities.
At the same time, COMSTE also seeks to create opportunities for those new S&T graduates and professionals by encouraging industry, entrepreneurs and investors to create new jobs. Take for example the Renewable Energy law we have just passed. The Energy Panel and the Electronics Panel of COMSTE are seeking ways to create an environment that takes advantage of the incentives we have given to create a local renewable energy sector and green jobs.
So the key word here is not just investments in R&D, but coordination. We have to coordinate, through the COMSTE, what the academe is doing, what industry is doing, what investors are doing, so they are in sync. So when the next big opportunity comes along, we are a team, we are ready.
We have in the past, regarded the academe and the research community as separate from industry. So we have a situation where the academics from UP do not know what the people from Intel or Philips are doing. It is the same in other industries. And therefore, we have not seen the kind of academe-industry collaboration or public-private partnerships that produces significant innovation, significant industries, significant jobs. So it is not just a question of putting money in S&T. We also need to change the culture and the way we do things. All that will change with COMSTE.
But to do all of what we seek to achieve, we need to allow the COMSTE to complete its task. Therefore we need to extend the term of the COMSTE until the end of the Fourteenth Congress, so that a few years from now, we can see the Philippines among the ranks of the rapidly developing economies (RDE) of Asia, and not the same place as where we are, because we failed to do what we need to do, because we stopped short of completing the race.