‘China shock 2.0’ could impact PHL–Nomura By Bless Aubrey Ogerio
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S China’s export machine expands across sectors, the Philippines is among the economies most exposed to the ripple effects, according to a new analysis by Nomura Holdings Inc. The Japanese financial group said the country, along with Indonesia and Thailand, faces elevated exposure due to its reliance on lower-value manufacturing, while Malaysia, India, and Vietnam are better positioned due to stronger integration into higher-value
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global supply chains. This was following the China’s global export share, which rose by 1.5 percentage points from 2019 to 2024, with gains spanning both high-tech industries and traditional manufacturing sectors. Nomura warned of a possible “China shock 2.0,” driven by the expansion of high-tech exports, which could have deeper and more sustained effects than the earlier disruption seen in the early 2000s. The rapid rise of China’s strategic export industries was highlighted, with combined shipments of electric vehicles, lithium-ion batteries, and solar panels in-
creasing by 349 percent between 2020 and 2025. Their share of total exports nearly tripled from 1.5 percent to 4.6 percent over the same period. Growth was even sharper in volume terms, with electric vehicle exports up 907 percent, batteries rising 674 percent, and solar panel exports increasing 586 percent. Beyond clean energy goods, China has also strengthened its position in heavy industries. Exports of construction machinery nearly tripled over the same period, while excavators now account for half of total sales, up from 17.4 percent previously.
Nomura said that even advanced economies are facing increased pressure, particularly in industries where China is rapidly gaining technological capability, including shipbuilding and construction machinery. It also pointed to a rise in trade defense measures worldwide, with countries such as India and South Korea increasingly resorting to anti-dumping actions as Chinese exports expand. The group identified several Chinese firms as key beneficiaries of this export surge, particularly in batteries, solar manufacturing, See “China,” A2
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Thursday, June 11, 2026 Vol. 21 No. 240
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By Andrea E. San Juan @andreasanjuan
OREIGN direct investments (FDI) net inflows plunged in Q1 2026 due to “still-cautious” investor sentiment amid high inflation and a slow growth environment. The Philippine economy saw a 17-percent decline in long-term capital inflows from foreign countries in the first quarter of 2026, reflecting a “still-cautious” investor sentiment amid the high inflation, slow growth environment in the country, coupled with global uncertainty. Analysts pointed this out after the latest data from the Bangko
Sentral ng Pilipinas (BSP) showed that Foreign Direct Investment (FDI) net inflows plunged to $1.717 billion in the first quarter of 2026, down 17 percent from the $2.068 billion posted in the January to March period a year ago. On a monthly basis, however, FDI net inflows climbed to $611 See “FDI,” A2
NDRRMC: QUAKE CASUALTIES AT 45 DEAD, 630 HURT, 17 MISSING By Jonathan L. Mayuga
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S the government mobilizes personnel and multiple assets to provide search, rescue and relief operations, the number of casualties and affected communities continues to increase. As of 12 noon, the death toll in the magnitude 7.8 offshore earthquake near Maasim, Sarangani Province, has reached 45, with 630 injured, reported the Office of Civil Defense (OCD), which acts as Secretariat of the National Disaster Risk Reduction and Management Council (NDRRMC).
OCD Assistant Secretary Bernardo Rafaelito R. Alejandro IV said government personnel from various National Government Agencies and NDRRMC-member institutions as well as multiple assets have been deployed to respond to the situation. The earthquake triggered by movements in the Cotabato Trench is the strongest that has hit Southern Mindanao since the 1976 Moro Gulf Earthquake and Tsunami that killed between 5,000 and 8,000 people, the Philippine Institute of Volcanology and Seismology (Phivolcs) said. See “Quake,” A2
TIGHT SENATE SECURITY AMID CREDIBLE THREAT Security personnel guard the entrance gate of the Senate building along J.W. Diokno Boulevard in Pasay City amid tightened restrictions following a reported security threat. Acting Senate President Sherwin Gatchalian ordered a work-from-home arrangement for Senate personnel and heightened security measures on June 10 and 11 after the National Bureau of Investigation flagged a credible threat. A temporary no-visitor policy has also been imposed, with stricter screening, increased surveillance, and security sweeps implemented to safeguard senators, officials, and staff. ROY DOMINGO
Erasing the ‘Korea Discount’ and the shift to productive wealth By Malou Talosig‑Bartolome (Second of two‑parts series)
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SUNG HWAN BYUN, Korea Exchange (KRX) Director General of Public Relations Management Strategy, briefing foreign journalists, including BusinessMirror’s Malou Talosig-Bartolome, on the policy reforms instituted by South Korean government to attract capital that led to Korea’s phenomenal stock market boom. MALOU TALOSIG‑BARTOLOME
EOUL—The historic stock market rally in South Korea was not an accidental byproduct of global tech enthusiasm. It was the result of deliberate reforms, aggressive dismantling of bureaucratic barriers, and pow‑ erful industrial fundamentals. For decades, household savings were locked into property, creating structural imbalances. “In Korea, most of the retail wealth has been allocated to the property market. Very high portion has been going to the property market. But the property market is not productive actu‑ ally,” said Yeon‑Ju Park, Head of the Research Center at Mirae Asset Securities. She stressed that this reliance led to “very uneven and unhealthy wealth distribution compared to developed markets like the US. In the US, when the stock market grows, ev‑ erybody benefits. In Korea, most of the wealth
goes to the property market, so only a few can enjoy the property market boom.”
Government intervention, policy shifts
TO change this trajectory, the government stepped in. Sung Hwan Byun, KRX Director General of Public Relations Management Strategy, said there is a deliberate intention “to move money from real estate to financial markets,” pointing to aggressive policy shifts such as the Corporate Value Program and robust growth in artificial intelligence (AI) and semiconductors. “As many of you know, 2025 was a re‑ cord‑breaking year for the Korean stock mar‑ ket,” Byun said. “The growth rate surged by 36 percent, ranking first among G20 countries. But the rally did not stop there. This year, we have seen an additional 100 percent growth.” He noted that since the launch of the pro‑ gram in May 2024, the KOSPI climbed from around 2,700 to 8,000 in rapid succession.
Historically, it took nearly two decades for the index to move from 1,000 to 2,000, and another 13 years to reach 3,000. “I think the corporate value program was a great starting point,” Byun added.
wards companies that increase shareholder returns. As a result, the average price‑to‑book ratio has climbed from under 1x to more than 2.5x, signaling renewed investor confidence.
Dissolving the ‘Korea Discount’
NOW, as the government pivots money toward “Productive Finance,” the semiconductor sector is absorbing this capital and thriving. Yeon‑Ju Park noted that the industry is expe‑ riencing a massive boom because of AI, earning an estimated US$200 billion annually. By funneling retail and institutional invest‑ ments into equities, tech giants like Samsung Electronics and SK Hynix can reinvest their revenues into new fabrication plants, R&D, and global expansion. This cycle of reinvestment is structurally reshaping the national economy.
THESE reforms helped dissolve the infamous “Korea Discount”—a chronic undervaluation of Seoul‑listed equities due to governance anxieties, low shareholder payouts, and geopolitical risk. Legislative overhauls to the Commercial Act codified a mandatory “duty of loyalty to share‑ holders,” forcing management to prioritize mi‑ nority investor returns. Companies are now required to cancel newly acquired treasury shares within 12 months, pre‑ venting them from consolidating voting power at the expense of smaller stakeholders. The Corporate Value Program further incen‑ tivizes firms to optimize capital efficiency and strengthen payouts. Separate taxation on dividend income re‑
AI and semiconductor boom
Attracting foreign capital
SIMULTANEOUSLY, the KRX modernized to at‑ tract foreign capital. See “Wealth,” A2
PESO EXCHANGE RATES n US 61.6110 n JAPAN 0.3843 n UK 82.3924 n HK 7.8619 n CHINA 9.0960 n SINGAPORE 47.9016 n AUSTRALIA 43.2694 n EU 71.1053 n KOREA 0.0404 n SAUDI ARABIA 16.4090 Source: BSP (June 10, 2026)