Ser Percival K. Peña-Reyes and Sarah Jane D. Lipura (Business Mirror)
IN the Philippines AmBisyon Natin 2040 represents the Filipinos’ collective long-term vision for the next two decades. It describes the kind of life that Filipinos want to have and serves as an anchor for development planning. The envisioned lifestyle can be summed up as follows: strongly rooted (matatag), comfortable (maginhawa) and secure (panatag).
Being strongly rooted means that Filipino families live together. There is work-life balance so that there is time to spend with family, even for members who work. People live in a high-trust society with a strong sense of community. There are opportunities for volunteer work where Filipinos get to serve the community, help others who are in need, and contribute to various causes.
Being comfortable means that no one is poor or hungry. Filipino families live in comfortable homes with the desired amenities and secure tenure. Families and friends are within reach because transport is convenient and affordable, and they can take a vacation together within the country or abroad. Children receive quality education, so that they realize their full potential. Decent jobs and opportunities for entrepreneurship are available.
Being secure means that Filipinos enjoy a sense of stability over their entire lifetime. They expect to live long and enjoy a comfortable life upon retirement. Financial resources can cover unexpected expenses, and there is room for savings.
For a developing country, like the Philippines, these ambitions would seem natural, since not many people actually get to enjoy such a lifestyle. For a developed country, these might even sound modest, or perhaps even trivial. Nevertheless, it is surprising to discover that South Koreans, prosperous and secure as they already appear, would still have the same modest ambitions as Filipinos.
From April 23 to 26, a research team from Ateneo de Manila University visited Seoul, South Korea, to interview experts in the areas of migration and tourism. One of the questions the researchers sought to answer was why South Koreans would even consider visiting
A casual review of data serves to contextualize this inquiry. The CIA World Factbook shows South Korean GDP is $1.929 trillion, while Philippine GDP is $801.9 billion. In per-capita terms, a South Korean’s income is $37,900, while a Filipino’s income is $7,700.
In terms of HDI, which is composed of health, education and income indicators, South Korea registers 0.901 (very high human development), while the Philippines registers 0.682 (medium human development).
In terms of the Global Competitiveness Index, South Korea ranks 26th overall, while the Philippines ranks 57th overall. South Korea is at the top 25 percent of surveyed countries, while the Philippines is closer to the middle (but still above it). Regarding infrastructure, in particular, South Korea ranks 10th overall, while the Philippines ranks 95th overall.
The interviewed experts note that, despite their obvious economic advantages, South Koreans go to the Philippines for three main reasons. One, South Koreans retire early yet live long. Two, the cost of living in South Korea is higher. Three, life in South Korea seems to be more stressful.
Data can corroborate such observations. With regard to the first observation, life expectancy in South Korea is 82.4 years, while in the Philippines, it is 69.2 years. However, the average retirement age in South Korea is 53 years, while the official retirement age in the Philippines is 60 years. The elderly dependency ratio in South Korea is 18.0 percent, while that in the Philippines is 7.2 percent.
So, with an aging population and longer life expectancy, South Koreans have a more compelling need to secure themselves after retirement, so they find ways to augment their limited income. Many move to the Philippines to start small businesses because the Philippines is expanding at a quicker pace (6.4 percent real GDP growth versus 2.7 percent in South Korea).
Indeed, as the Organisation for Economic Cooperation and Development notes, South Korea is experiencing a spell of slower growth and low inflation, while productivity is low due to large gaps between manufacturing and services, and between large companies and small and medium enterprises (SMEs). There are also problems in the labor market that exacerbate inequality and poverty, thus discouraging employment.
With regard to the second observation, according to the Worldwide Cost of Living Report published by the EIU, Seoul is the sixth-most expensive city in the world. This could mean that a pensioner living in Seoul could stretch his income even further if he decides to move to the Philippines.
Last, with regard to the third observation, according to the World Health Organization, South Korea has 24.1 suicides per 100,000 people per year (ranked sixth overall), while the Philippines has 3.8 suicides per 100,000 people per year (ranked 162nd overall). Perhaps, it is true that “It’s More Fun in the Philippines”.
So, with South Koreans looking to make a living here in the Philippines, opportunities to generate more income and jobs are forthcoming. Perhaps, it would be wise to welcome these South Koreans who share the same modest aspirations in life.