Singapore—A political and geo-economics analyst on Thursday said here that robust consumption and investments will drive the Philippine economic growth.
Stratbase Group chief executive officer and Bower Group Asia’s managing director Prof. Victor Andres Manhit made the statement during the second Philippine economic briefing here, with the theme “Unfolding New Chapters in the Philippines’ Growth Story”.
Manhit joined Philippine economic managers in Singapore as the private sector representative and as a reactor in a panel discussion. Singapore is one of the Philippines’ top sources of foreign direct investments (FDIs).
In his speech, Manhit noted that in 2022, the Philippines was one of the fastest growing emerging markets with a gross domestic product (GDP) growth rate of 7.6 percent. He said the country’s GDP was projected to reach $1 trillion by 2033.
“Philippines has a huge consumer base of over 110 million and a population that is young, skilled, and educated. Private consumption buoyed by sustained income growth due to government and private sector investments will be key growth drivers to the growing Philippine economy,” Manhit said.
“Like never before, the Philippines is more open to business as it harnesses greater productivity especially in the manufacturing and agro-industry sector. A fully developed manufacturing sector can provide a stable and resilient economy, given its multiplier effect in increasing productivity, creating jobs, providing income, and spurring consumption,” he added.
Manhit told Singapore-based business leaders, bankers, and investors that despite various socio-economic challenges, consumer and business sentiments on the Philippine economy have improved due to increased opportunities for employment and growth.
“President Marcos Jr. has a strong political capital and a competent economic team equipped with concrete plans and solutions to address the Philippines’ most pressing concerns. The 8-point socioeconomic agenda addresses the country’s development challenges, while the Philippine Development Plan (PDP) 2023-2028 is intended to steer the economy back to a high-growth path by reinvigorating job creation and sustaining inclusive growth,” Manhit explained.
“Robust consumption supported by remittances and improved job opportunities would drive economic growth. Remittances add more capital to the local economy, fostering growth in consumer consumption and investments. Additionally, increased job opportunities would encourage individuals to participate more actively in the economy, raising their income and boosting consumption,” Manhit said.
He also said the developments in Philippine legislation, the expansion in diplomatic engagements, and the improvements in politics, together with the administration’s continuing action pressing issues are cause for optimism in the years to come.
The Philippine economic managers who joined the Philippine Economic Briefing in Singapore included Finance Secretary Benjamin Diokno, Bangko Sentral ng Pilipinas (BSP) Deputy Governor Francisco Dakila Jr., Budget Secretary Amenah Pangandaman, and National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan.
In his keynote speech, Diokno presented an overview of the country’s economic performance and key economic liberalization reforms to encourage foreign investments in different sectors of society. These include achieving price stability through appropriate monetary and fiscal measures, implementing structural reforms to increase the flow of investments, and opening the renewable energy sector to full foreign ownership.
Balisacan talked about infrastructure investment and development, where he enumerated opportunities for investors and businesses. He emphasized that “the Philippines is more open to businesses now than ever before”.
On the other hand, Pangandaman discussed the priority expenditures supporting the Philippine Development Plan 2023 to 2028. These included projects in the social services sector, agricultural modernization and food security, physical and social infrastructures, digital transformation, and climate change expenditures, and support to local governments.
For his part, Dakila tackled the performance and outlook of the monetary, external, and financial sectors.
He said “indications of previous monetary tightening exerting its impact on the economy and the projected return of inflation to target range in the fourth quarter of 2023 have given the BSP sufficient reason for a prudent pause.
He also said the BSP however, remains ready to resume monetary tightening as warranted by the data on the inflation outlook.”