There are nuts attached to bolts, anatomical nuts assuring procreation, pistachios and walnuts and their ilk, and crazy people. This one is about a different nut, a tipping point, the point at which poverty is toppled to become growth, and from that, wealth.
I wrote recently about my island, Biliran. I suggested that Americans are missing the boat by not retiring here, for the price is right and the landscape is drop dead gorgeous.
Regular reader Attila knocked me back a peg by pointing out that it is wholly impractical for Americans to retire in the Philippines, for the commute is outrageous, 20 hours from the east coast of the US. Even the Department of Tourism is ahead of Joe Am on this particular line of thinking. DOT is currently focused on East Malaysia as a source of more tourists. Last year some 76,000 Malaysians visited the Philippines, and the goal is to build that number. The air flight is about 2.5 hours.
Here is a link to an article certifying the DOT's pragmatic approach to attract more Malaysians to the Philippines: Malay Tourism
Having conceded to the wisdom of proximity as an important driver of tourism, let me at least ramble a bit about the retirement angle. That is, getting Americans to retire in the Philippines. That is different than getting people to visit when there is not much to visit, entertainment wise. There are lots of elegant, laid back retirement places. Beaches, mountains, large plots of land. Inexpensive bungalows.
I have no idea as to the demographic statistics of Americans who live here, or their means or motives. My observations lead me to believe most are older, most have Filipina wives, and many served with the US military in the Philippines. There are a very few white couples, both husband and wife. There are a lot of mixed race kids, American Caucasian and Filipino. The half-and-halfs seem to get along fine because they have the advantage of money.
To prove that this blog may be close to fiction, but perhaps instructional nonetheless, I also admit I know little about the demographic statistics of Americans approaching retirement age. I suspect they are not all feeling very secure nowadays knowing they have to figure out how to live 20 more years on diminished savings and a pittance of income. I know the baby boom is emerging into retirement. So I'll bet there are a pile of them (a refined statistical concept) who are no longer married (widowers, divorced) and who have found life getting a tad narrow and, perhaps boring. And perhaps expensive for their paltry pensions.
Let's say there are 10 of these out of 300 million Americans that Joe Am, through his slick marketing moxie, convinces to retire in the Philippines on Biliran Island. My assumed profile of the 10 is that they are not rich dudes. They are regular people, maybe even at the low end of the economic scale. On my fictional pro-forma, each would bring cash to the Philippines of about US$ 25,000, gained from selling their US place for the paltry amount it is now worth. And they have monthly Social Security income of US $1,000.
What is taken out of the US is small. What is injected into a small island's economy is substantial. It is an immediate injection of $US 250,000, which at 43.5 pesos per dollar, represents 10.8 million pesos. The monthly inflow is US $10,000 or 435,000 pesos per month.
On an island like Biliran, we are talking about a huge kick in the economy. A lot of the monthly amount would find its way into labor. Say 200,000 pesos. That is employment for about 20 people. Who in turn spend their salaries locally, and the money joins the downstream churn that makes life better for everyone.
So, yes, I agree it is not practical to expect a flood of Americans to the Philippines. But there can be a nice injection of wealth with just a few people.
Or, pick off some Chinese retirees.
The point is the same.
Open the Philippines to money. Forget the color of skin or oddness of cultural differences. It all melts together under the hot tropical sun. Cash knows no racial barrier, and will make a beeline for the wallets, purses and bank accounts of Filipinos.
Once you get the flow started, the breadth of the economy, thin though it is, will provide the foundation for circulating wealth and much better lives for many.
It just takes a little push to get past the nut.
Laws that keep money out give an indication of exactly WHY the Philippines is one of the poorest countries in the world.
At what cost, racial pride?
Children who are malnourished? Who can't afford school? Who live in squalor?
For this, you insist upon fearing American wealth? Or Chinese?