Manila's work in progress

Politically and economically, the resource-blessed Philippines has habitually sold itself short. The colossal plunder and misrule of the Marcos years, which damaged the people's perceptions of politicians and the idea of honest, gainful striving, is a national burden. Deep-rooted corruption has been difficult to tackle but imperceptibly, the country has been making up ground.

There has been growing trust in government. There have been gains in investments and fiscal rectitude, to a stage where Morgan Stanley and Goldman Sachs are making bold predictions for a country which used to be known for coups, party-loving politicians and a general permissiveness. One prediction is that the Philippines will be among the world's top 20 economies within the half-century.

Leaving projections aside, published indicators do provide a persuasive picture. The stock index which rose 25 per cent this year is among the best performing in Asia. The peso is the strongest emerging market currency on copious foreign direct investment, although it should be noted this is not an unalloyed gain. GDP growth has for several years been on a sustainable range of 5 to 6 per cent. Inflation is under control.

Most significantly, the Philippines insulates itself well against external buffeting by being not too dependent on exports. Consumption accounts for 70 per cent of the economy, about the ratio of rising stars like Indonesia.

Credit for the improved fortunes should go to President Benigno Aquino, only two years into his term but what a breath of fresh air, after the wreckage of Joseph Estrada's tenure and the inconsistencies of Mrs Gloria Arroyo.

He bears the weight of his mother's highly moral persona but has been found to be equal to the task. His move on corruption and tax leakage coupled with cuts in wasteful spending have impressed investors, who are willing to bet on what was once regarded as a laggard in a fast-moving Asean bloc.

When the central bank cut interest rates to discourage an excessive inflow of capital, the Philippines was acting much like Singapore and Hong Kong, prime economies whose stability depends on sensible exchange rates and the prevention of asset price bubbles.

Now that the Philippines is a net contributor to Asean's accumulation of economic ballast, many will be hoping that Mr Aquino can prevail over Manila's vicious intrigues and the machinations of special interest groups.

These remain formidable, a throwback to the era of Ferdinand Marcos and his acolytes. Aquino will need all the public support he can muster to complete the job he has started of setting his country on the path to prosperity.