Strait of Hormuz: No ground for complacency

It's not something that responsible governments could simply brush off, that potential violation of the recent ceasefire between Iran and Israel peddled and initially, unilaterally announced by US President Donald Trump.

- DIWA C. GUINIGUNDO

But what do we make of President Ferdinand Marcos, Jr.’s statement reported yesterday about the economic consequences of this military discord and describing them to have no “significant effect?”

In this volatile and uncertain moment of history, it is an enormous disservice to the Filipino people for the government to simply retreat to rational inattention. This makes sense only when our decision makers have simply no other information available to them. But our economic management departments, including the Bangko Sentral ng Pilipinas (BSP), have enormous database and econometric capacity to draw up some scenarios that would likely capture various possible outcomes in the Middle East. And they are not all favorable scenarios to be sure. They could also source sensitive primary information from our consular offices and embassies abroad that have started to evacuate our overseas Filipino workers based in these oil-rich labor markets. There should be a logical connect between what we announced and what the rest of government are doing.

We need extraordinary due diligence to substantiate our decision to ignore the potentially debilitating effects of a further escalation of war between Iran and Israel. There is no substitute to calling on the population to hope for the best, but prepare for the worst.

Thus, the President could have been more careful even as he based his comments on the assessment of the country’s economic managers: “May effect siyempre kahit papaano... ang langis (Oil has an effect no matter what.).” We can only presume that the assessment was ostensibly based on the announcement of a truce and the limited impact on macroeconomic stability. We dare say that it is never enough to simply monitor oil prices and anchor all contingencies in their dynamics.