Income inequality in Philippines still tagged as one of Asia’s worst

MANILA, Philippines - Income inequality in the Philippines has declined slightly, according to the International Labor Organization (ILO), but it is still one of the worst in Asia.

In a report released Thursday, the organization noted that, in Asia and the Pacific, only the Philippines and Cambodia posted a decline in income inequality.

The Philippines, however, remains with one of the highest income inequality indices in the region.

The Philippines’ income inequality index of 52 in the 1990s fell to 50 in 2000.

Singapore, Thailand, and Cambodia have indices below 50, while China, Vietnam, India and Laos have indices below 40, but did not post any decline in income inequality in the comparative periods.

"Inequality has always been with us," said University of the Philippines School for Labor and Industrial Relations professor Rene Ofreneo in a telephone interview Thursday. "The problem is that while there is great growth there, it is also jobless growth. It is the same with other Asian nations like China."

The ILO believes that the current financial crisis serves as a chance to review current labor policies of countries. "We see crisis as an opportunity to review and learn. Policies and social protection systems in place can have an effect on a country’s ability to cope. It is important to design and implement labor and product market policies to prepare countries to adjust quickly," said ILO Subregional Office for South East Asia and the Pacific director Linda Wirth in a statement released to the press.

The ILO report stated that countries like China and Laos showed an increase in income inequality in the periods covered.

"This report shows conclusively that the gap between richer and poorer households widened since the 1990s," said Raymond Torres, Director of the ILO’s International Institute for Labor Studies in the statement.

Mr. Ofreneo said this is true, particularly in the Philippines. "Part of the problem is that the reforms the government makes does not work because it does not target those that need it," he said. — E. N. J. David, BusinessWorld

source: GMAnetwork.com