BSP: PHL may miss DBCC growth goals
T
GET ready to step into a world of colors and culture this August and experience #VibrantKadayawanatSM only in Davao’s premier lifestyle and entertainment destination, SM Lanang! SM SUPERMALLS
ROTARY CLUB OF MANILA JOURNALISM AWARDS
2006 National Newspaper of the Year 2011 National Newspaper of the Year 2013 Business Newspaper of the Year 2017 Business Newspaper of the Year 2019 Business Newspaper of the Year 2021 Pro Patria Award PHILIPPINE STATISTICS AUTHORITY 2018 Data Champion
HE Philippine economy could miss its growth targets this year due to its weak performance in the second quarter, the global slowdown and high oil prices, according to the Bangko Sentral ng Pilipinas (BSP). Another major consideration is the impact of the monetary tightening of the BSP. In Aug ust, however, the Monetar y Board made a “hawkish pause” with key policy rates being kept at 6. 25 percent. (Full stor y here: https://businessmirror.com.ph/2023/08/17/bspkeeps-rates-after-q2-growthslowdown/) BSP said the peak of the impact
of the 425-basis-point increase in policy rates will be felt next year. The BSP started raising interest rates in May 2022 and has been the most aggressive in the region in terms of monetary policy tightening. (https://businessmirror. com.ph/2022/09/15/bsp-mostag gressive-in-hiking-polic yrates/) “The growth forecasts indicate continued economic expansion, albeit at a slower pace, with projected impact of the BSP’s policy rate adjustments peaking in 2024,” BSP said in its Monetary Policy Report (MPR). World GDP, based on International Monetar y Fund (IMF)
projec t ions, cou ld average 3 percent in 2023 and 2024 and 3.2 percent in 2025. In its May MPR, BSP said growth could average 2.8 percent in 2023 and 3 percent in 2024. Oi l pr ices are ex pected to trade higher at $81.9 per barrel in 2023 from the initial estimate of $77.2 per barrel. Dubai crude prices could also trade at $82.3 per barrel in 2024 and $78 per barrel in 2025. The BSP also noted “waning pent-up demand” that could contribute to the slowdown in the growth of the Philippine economy this year. See “BSP,” A2
BusinessMirror
EJAP JOURNALISM AWARDS
BUSINESS NEWS SOURCE OF THE YEAR
(2017, 2018, 2019, 2020, 2021) DEPARTMENT OF SCIENCE AND TECHNOLOGY
2018 BANTOG MEDIA AWARDS
IN 4TH MONTH OF DEFICIT, w
n
Monday, August 21, 2023 Vol. 18 No. 308
P25.00 nationwide | 2 sections 20 pages |
JULY BOP AT $53M—BSP T
By Cai U. Ordinario
@caiordinario
HE country posted a balance of payments (BOP) deficit for the fourth consecutive month this year, according to data released by the Bangko Sentral ng Pilipinas (BSP). BSP said the country’s BOP position posted a deficit of $53 million in July 2023. However, this is lower than the $1.8-billion BOP deficit recorded in the same month last year. For this year, the BOP deficit was the largest in June at $606 million, followed by the $439 million in May 2023. The country only saw a BOP surplus twice this year—January at $3.081 billion and March, $1.267 billion. “The BOP deficit in July 2023 ref lected net outf lows arising mainly from the National Government’s [NG] payments of its foreign currency debt obligations,” BSP said. BSP data also showed that despite the deficit in July, the BOP position of the country was in surplus for the past seven months. The data showed the cumulative BOP position of the country posted a surplus of $2.2 billion in the January to July period of the year. This, BSP said, was a reversal from the $4.9-billion deficit recorded in the same period of 2022. “Based on preliminary data, this development reflected mainly the improvement in the balance of trade and the sustained inflows from personal remittances, net foreign borrowings by the NG
[national government], trade in services, and foreign direct investments,” BSP said. BSP, quoting preliminary International Merchandise Trade Statistics (IMTS) data from the Philippine Statistics Authority’s (PSA), noted that the trade deficit for January-July 2023 reached $28 billion, down from the $29.8 billion deficit posted in the same period last year. With this, the BSP said the gross international reserves (GIR) level increased to $100 billion as of endJuly 2023 from $99.4 billion as of end-June 2023. BSP noted that the country’s GIR level increased despite the BOP deficit in July 2023, mainly due to the upward revaluation adjustments in BSP gold holdings and foreign currency denominated assets. “The impact of non-economic transactions such as revaluation adjustments is excluded in the computation of the BOP position,” the BSP said. The latest GIR level, BSP said, represented a more-than-adequate external liquidity buffer equivalent to 7.4 months’ worth of imports of goods and payments of services and primary income. See “Deficit,” A2
BOUNTY FROM THE SEA Members of the New Masinloc Fishermen’s Association haul in their fish catch from payaos installed in the sea off Masinloc, Zambales in this photo taken last June. The fishermen finally got compensation from a Hong Kong-based firm whose cargo ship ran over their payao early this year. Story in A12, Second Front Page. PHOTO COURTESY OF NMFA
D.O.T. TO FUND INDIGENOUS PHL garments exporters eye PEOPLE’S TOURISM PROJECTS Pakistan textile firms’ supply By Ma. Stella F. Arnaldo
@akosistellaBM Special to the BusinessMirror
T
EXPLAINER »B4
THE FALL OF RUDY GIULIANI:
HOW ‘AMERICA’S MAYOR’ TIED HIS FATE TO DONALD TRUMP AND GOT INDICTED
HE Department of Tourism (DOT) will fund initiatives that develop and promote indigenous peoples’ culture, in a bid to advance heritage tourism in the country. The DOT said it had signed a memorandum of agreement with the National Commission on Indigenous Peoples (NCIP) to jointly implement the Katutubo-Kapwa project, “a nationwide initiative which will enjoin support for the indigenous cultural communities/ indigenous peoples [ICCs/IPs] in tourism development, covering destinations and IP communities in Luzon, Visayas, and Mindanao.” As per the MOA, a technical
working group, with representatives from both agencies, will be created to monitor and oversee the project’s implementation, which will be led by the DOT’s Office of Special Concerns. “Our indigenous communities are the vanguards of Filipino identity,” said Tourism Secretary Christina Garcia Frasco in a news statement.“We subscribe to the belief that in honoring the origins of the Philippines and the Filipino people, we strengthen the Filipino brand…[The] Department of Tourism has sought this partnership with the NCIP because we sincerely wish to manifest our firm commitment to honoring our indigenous peoples and giving them opportunities for economic advancement through tourism,” she added. See “DOT,” A2
By Andrea E. San Juan
P
AKISTAN’S 10 “biggest” textile and garments factories which are exporting worldwide have committed to supply textile and fabrics for Philippine garment exporters given the Philippines’s “unrivaled” access to key markets, according to the Philippine Exporters Confederation Inc. (Philexport). Philexport said Robert Young, Trustee for textile, yarn and fabric sector of Philexport, reported this following his participation in the Asean-Pakistan Business Opportunities Conference held in Lahore and Karachi, Pakistan in early August. Young, who is also president of Foreign Buyers Association of the Philippines (FOBAP), said these factories have committed to supply “mainly 100 percent cotton
sheets and denim” for the Philippine garment exporters. He emphasized that “[these garment exporters] rely solely on imported materials as the Philippines has no such industry.” The FOBAP president pointed out that Pakistan’s textile and fabrics cost 15 to 20 percent lower than those of other countries. In fact, Young added, “Pakistan has an average lower production cost than countries like China, India and Vietnam, while offering the same high-quality fabrics due to its skilled workers and yarn quality, billed as the second-best quality cotton in the world.” Meanwhile, Young said that with the Philippines’s present free trade agreements (FTAs) such as the Regional Comprehensive Economic Partnership (RCEP), and other forthcoming FTAs and the recent See “PHL,” A2
PESO EXCHANGE RATES n US 56.6780 n JAPAN 0.3886 n UK 72.2531 n HK 7.2400 n CHINA 7.7761 n SINGAPORE 41.7394 n AUSTRALIA 36.2796 n EU 61.6090 n KOREA 0.0423 n SAUDI ARABIA 15.1133 Source: BSP (August 18, 2023)