Global Risks Facing The Marcos Presidency: Geopolitics vs Economics


WE are now in the most dangerous situation in the world since 1945, according to Dr. Steinbock, founder of the global think-tank Difference Group. There was a promising possibility in 2016 where we might have had a global recovery, but it did not happen due to the US-led trade wars which increased trade deficits.

Two decades of progress have been reversed in just two years. Inflation has become a real problem, and many countries could fall into major stagflation reminiscent of the 1970s. The absolute number of international migrants has tripled, and this phenomenon is happening amid the backdrop where borders are closing. The number of globally displaced is more than twice as high as it was during the two world wars.

The countries most hit by food crises are emerging economies who are commodity importers. In Asean-6, the weight of food in the consumer price inflation basket is 20 percent to 40 percent, and together with fuel at least 50 percent to 60 percent of the basket, Dr. Steinbock presented.

Indeed per OCTA’s “Tugon ng Masa,” “controlling the prices of basic good” was the top concern for over 63 percent of those living in the National Capital Region and over 52 percent of Class D and E. The survey was done in March 2022, when the economy was still upbeat from the 8.3 percent Q1 GDP reports. Interestingly only 3 percent and less feel the maritime disputes with our neighbors, controlling the population growth, changing the Constitution are urgent national concerns.

Ukraine war just the tip of the iceberg

The situation now is often blamed on the Ukraine war, which is a very limited war from a physical basis, but a world war from a political basis. The global instability is really due to the US printing over $5 trillion at the start of the pandemic as “stimulus bills,” and sanctions on non-aligned countries. The exports of energy oil and food were not really highly restricted, until the US kept increasing sanctions on Russia, and Ukraine’s president Volodymyr Zelenskyy blocked exports to get more concessions from the US.

Independent foreign policy matters more than ever before. Looking at the development of the East Asian miracle cases and Brics, we see that those countries that are successful in their economic development have a “zero conflict principle,” but this is very difficult to sustain, as can be seen when a small country is sandwiched between two giants, Independent foreign policy matters more than ever before. Looking at the development of the East Asian miracle cases and Brics, we see that those countries that are successful in their economic development have a “zero conflict principle,” but this is very difficult to sustain, as can be seen when a small country is sandwiched between two giants, advised Dr Steinbock in a forum “Global Risks Facing the Philippines” hosted by the Integrated Development Studies Institute (IDSI).

So far, President Ferdinand Marcos Jr. has said he will continue Duterte’s independent foreign policy that works to befriend all, while prioritising the Philippine national interest, and closely aligning with Asean interests. The Philippines has to find a cooperative stance when it comes to Chinese and US objectives, and to achieve continued economic growth that the Filipino people need and want, according to geopolitical analyst and IDSI director George Siy.

Provocateurs for war

The Taiwan issue is a major flashpoint in the Asia-Pacific region, and it is there where a Ukraine 2.0 could possibly erupt in Asia. Right now, there is already a confluence of events that could make that happen, according to Prof. Bobby Tuazon, director for Policy Studies of CenPEG. Beijing has repeatedly said that it will continue to pursue peaceful reunification with Taiwan. But if Taiwan decides to declare independence from China, China will use all military means to prevent Taiwan from being split from China.

A similar playbook in the Ukraine crisis, the Taiwan tensions come from the US provoking actions against China, including constant media orchestrations, blocking of information, increasing major naval exercises across the Taiwan Strait monthly. The US has also been equipping Taiwan with military “aid,” and selling $70 billion of weapons to Taiwan, all in violation of the One China principle and international law. While the US interest is interpreted as a “strategic ambiguity” policy over the Taiwan issue, it’s clear that the US is provoking China to start a military action.

NATO is now centrally involving itself both in the Ukraine war and the Taiwan issue. When a war between the US and China happens over the Taiwan issue, the Philippines will be involved in that unavoidable war as a security ally of the US.

The Marcos administration should start reviewing its security alliance with the US such as the Mutual Defense Treaty and the Visiting Forces Agreement, which the Philippine Congress ratified, but not the US Congress. These oblige the Philippines to support American aggression not only in Asia but anywhere in the world, but do not obligate the US to do the same for the Philippines, warns political analyst and UP professor Tuazon.

Countries are constantly being forced not only to choose sides, but to choose between geopolitics or economic development.

When Xi Jinping espoused his Belt and Road Initiative plans in 2013, there was much idealism that China and the Western world could work together and cooperate. But the worst has happened which is the loss of strategic trust; and this will be hard to restore. This kind of situation where geopolitics comes first prior to economic development has and will hurt the US. The US economy, while still dominant in the world economy, makes many other countries pay the bill, according to Dr. Steinbock.

Recommendations for the Marcos administration

For the short term, the country has to focus on managing the inflation on food, transport and electricity and President Marcos has already said that he will respond to these issues.

Our OFWs, BPOs, tourism, manufacturing will benefit from the devaluation of the US dollar, it’s not bad for everybody, but it’s going to be bad for the working class since they spend on these essential items. But there are things we can do such as speeding up our digitization and productivity, advises business community leader George Siy.

For the medium term, the country has to prepare for the 4th Industrial Revolution, education and digitalization of the economy, where we are already being surpassed by our Asean neighbors. Fast-tracking connectivity will increase enterprise and reduce traffic, without as much investments needed as capital intensive industries and development.

In the medium term and long term, foreign policy — the case of Ukraine is a live lesson that war easily wipes out the fruits of decades of development. Yet, we don’t have to keep reacting defensively to maneuvers of powerful countries that try to dictate what must be done. We can and should take initiatives to help shape the policy directions of Asean and the world.

The world is facing many turning points and our input in this area will allow us to be more proactive in international affairs, instead of just being pawns. The current Philippine position allows us to do this.

A similar version was published in Manila Times on July 16, 2022. We welcome logical feedback and possibly working together with compatible frameworks. (

To watch the webinar “Privatization of Conflict”:

Austin Ong has assisted Philippine agencies in organizing training programs for Filipino entrepreneurs. He taught global developments in De La Salle University and studied in UP Diliman, Tsinghua and Northeastern Boston.

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