PHL set for investment-led boom, says BMI
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HE Philippines is on track to become a trillion-dollar economy by 2033 as it is seen to be well-positioned for an investment-led boom, according to BMI, a Fitch Solutions Company. The economy is expected to post a real GDP growth of 6.8 percent this year driven by recent economic reforms, demographic trends and higher infrastructure spending. BMI’s bullish scenario showed that the economy may expand by an average of 7.2 percent across their 10-year forecast horizon. “The Philippines has been one of the fastest-growing emerging markets in Asia and will remain so in the next decade,” BMI said.
“In fact, it appears on track to become a trillion-dollar economy by 2033, putting it in the same category as the likes of Thailand and Vietnam,” it added. Economic reforms cited by BMI included efforts to relax restrictions on foreign ownership in selected industries. BMI noted that the economic charter change being espoused by the current administration will complement these efforts. The previous administration passed reforms that included the amendments to the Public Service Act as well as the Foreign Investment Act. In terms of demographic trends,
the country’s young population is expected to help the Philippines attract low-end manufacturing processes from China. The Philippine Statistics Authority estimated that by July 2030, there will be a total of 120.06 million Filipinos. More than half of this population or 81.56 million will be between 15 and 64 years old, the ages included in the country’s labor force. “As tensions between Beijing and Washington intensify, foreign investors will continue to withdraw their investments from China. This shift in global capital away from the Chinese market could potentially enhance the appeal of
the Philippines as a destination for investors,” BMI added. The government’s efforts to address the country’s infrastructure constraints has already translated to better Foreign Direct Investment (FDI) inflows to an average of 2.6 percent of GDP since 2017, higher than the 1.5 percent of GDP between 2010 and 2016. BMI said the main drag for the country is high corporate income taxes that are currently at 25 percent—considered the highest in the region. Efforts to bring this rate further down to 20 percent are currently
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Thursday, April 18, 2024 Vol. 19 No. 184
P. | | 7 DAYS A WEEK
SLIDE, OIL PRICE RISE B C U. O
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@caiordinario
HE Bangko Sentral ng Pilipinas (BSP) remains undaunted by the recent depreciation of the peso as well as the rise in oil prices due to geopolitical tensions in the Middle East.
In a briefing on Wednesday, BSP Governor Eli M. Remolona Jr. told reporters the depreciation of the peso is an “adjustment” that would only have a small impact on monetary policy. As to the impact of higher oil, Remolona said there is no sense of escalation with regard to the tensions in the Middle East and that “retaliation will not be massive.” “In fact, the price of oil, Brent oil and Dubai oil, initially went up, but now has settled back down. So, the sense of the oil market is that hostilities will not escalate. So I hope it stays that way,” Remolona said. “The magnitude of the adjustment of the peso has not been large enough to affect inflation expectations. So, for now, I think the impact on monetary policy is, I would S “BSP,” A
WHEELING WOES
The Metropolitan Manila Development Authority has initiated a ban in major roads on light electric vehicles, including tricycles and bicycles, starting today. Those caught violating the ban will face traffic penalties upon apprehension. Despite this, e-trikes continue their usual routes along Baclaran’s roads in Tambo, Parañaque City. The ban specifically targets hazardous roads prone to traffic congestion. NONIE REYES
Grids still on yellow alert; ECONOMIC GROWTH IN ASIA 31 plants still on shutdown
TO HIT 4% IN ’24–UNCTAD B A E. S J
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@andreasanjuan
HE Asian economy as a whole is projected to grow by 4 percent in 2024 amid trade disruptions, climate change and persisting inequalities, among others, according to the United Nations Conference on Trade and Development’s (Unctad) Trade and development report. Unctad’s latest projections point to global growth of 2.6 percent in 2024, slightly slower than in 2023 on the back of “pressing challenges” of trade disruptions, climate change, low growth, underinvestment and inequalities “growing more serious.” As persisting trade disruptions made it to the list of the pressing challenges for this
year’s economic outlook, Unctad specifically noted that the situation in the Red Sea is likely to remain “highly uncertain” as long as the war in Gaza endures. With this, the UN trade body noted that global merchandise trade remains “subdued” while trade in services shows “more dynamism.” Meanwhile, in terms of regional growth, the UN trade body said it sees the Asian economy growing by 4 percent in 2024, as it disclosed the respective economic growth projections of some countries within Asia. For one, Unctad said China expects to grow by around 5 percent on the back of its “economic confidence and ambition” as the country’s economic data from January to FebS “UNCTAD,” A
B L L @llectura
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HIRTY-ONE power plants in Luzon and Visayas are still on shutdown while eight more are still running on de-rated capacity, prompting the National Grid Corporation of the Philippines (NGCP) to place the grids on yellow alert on Wednesday. In an advisory, NGCP said the yellow alert in the Luzon grid is in effect from 1 p.m. to 11 p.m. and from 1 p.m. to 10 p.m. in the Visayas grid. The NGCP said 18 power plants in Luzon are on forced outage while three others are running on deC A
“The plant operators must always be prepared. We have rules and regulations on plant maintenance schedule. If these will not be followed, then the ERC [Energy Regulatory Commission] can come in and penalize them.” —Department of Energy Assistant Secretary Mario Marasigan
PESO EXCHANGE RATES US 56.9710 ■ JAPAN 0.3683 ■ UK 70.8093 ■ HK 7.2748 ■ SINGAPORE 41.7523 ■ AUSTRALIA 36.4614 ■ SAUDI ARABIA 15.1882 ■ EU 60.4975 ■ KOREA 0.0410 ■ CHINA 7.8711 Source: BSP (April 17, 2024)