ECCP at Work

ECCP@Work Featured Articles | March 24, 2023

March 24, 2023

ECCP Online

ECCP at Work

Moody’s unit cuts Philippine GDP growth forecast to 5.7%

The research arm of the Moody’s Group has slashed its growth forecast for the Philippines to 5.7 percent this year, from an earlier estimate of 7.1 percent, on the back of stubborn and persistently high inflation. Steven Cochrane, chief economist for Asia-Pacific at Moody’s Analytics, said the Philippines had the largest downgrade in the region in terms of gross domestic product (GDP) growth forecast for this year. However, he said the Philippines would still emerge as the fastest growing economy in the region, followed by Vietnam’s 5.4 percent, India’s 5.1 percent, China’s five percent, Indonesia’s 4.5 percent, Hong Kong’s 4.1 percent and Thailand’s 3.5 percent.

Asia-Pacific unlikely to hit SDG targets by 2030 — ESCAP

The Asia-Pacific region would likely miss 90% of its sustainable development goals (SDGs) by 2030, the Economic and Social Commission for Asia and the Pacific (ESCAP) said. Armida Salsiah Alisjahbana, undersecretary general of the United Nations and executive secretary of ESCAP, said the region should have made at least 50% of the progress needed to achieve the targets by this year, which is the midpoint toward 2030.

NEDA ordered to conduct study on delayed devolution timeline

President Ferdinand R. Marcos, Jr. has tasked the Commission on Devolution with studying a delayed timeline for transferring National Government functions to local government units, citing concerns about the LGUs’ ability to carry out these functions. Ms. Pangandaman said the study, which will be led by NEDA Secretary Arsenio S. Balisacan, will be the basis for any amendments to Executive Order No. 138, which gave LGUs a three-year transition period until 2024 to fully assume some NG functions.

19 areas ripe for RE

The Department of Energy (DOE) approved 19 pre-determined areas that are ripe for renewable energy development under the fourth Open and Competitive Selection Process (OCSP) to be conducted this year. Under OCSP, prospective developers can bid for the right to develop pre-determined areas where the DOE has conducted prior resource studies. DOE Undersecretary Rowena Guevara said during the Philippine Electric Power Industry Forum in Manila city on Monday  from the 19 areas, 13 are hydro prospects for a total capacity of 86.25 megawatts (MW), three for geothermal for a capacity of 160 MW and another three for wind projects but its total capacity is not yet finalized.

BoP deficit widens to $895M in Feb.

Dollar Outflows rose in February, driving the balance of payments position to its biggest deficit in five months, on the back of foreign loan payments and a wider trade gap, the Bangko Sentral ng Pilipinas said. Data released by the BSP late on Monday showed the BoP position widened to an $895-million deficit in February, from the $157-million shortfall a year ago. It was also a reversal from the $3.08-billion surplus in January, which reflected the National Government’s $3-billion global bond issuance.

PHL may grow by 5.3% this year — McKinsey

The Philippine economy is expected to grow at a slower pace this year, reflecting the high unemployment, rising interest rates, and elevated inflation. In a report, McKinsey & Co. Philippines said gross domestic product (GDP) may expand by around 5.3% this year, although this is a “moving target.” This 5.3% GDP forecast is well below the government’s 6-7% target for this year. In 2022, the economy expanded by 7.6%. First-quarter GDP data will be released on May 11.

House gives 3rd reading approval to REIT, crop insurance bills

The House of Representatives approved on third and final reading a bill requiring real estate investment trusts (REITs) to reinvest the proceeds of their fundraising activities in the Philippines. Legislators also passed on third reading measures encouraging the private sector to invest in crop insurance and establishing a financing program for micro and small enterprises. Sitting in plenary session on Tuesday, 283 legislators voted for House Bill No. 7525, with zero no votes and zero abstentions. The bill seeks to amend Republic Act No. 9856 or the Real Estate Investment Act.

Strong bank fundamentals shielding Philippines, Asean

British banking giant HSBC sees strong underlying banking fundamentals and “progressive” regulators serving as buffer for the Philippines and the rest of Southeast Asia against shock waves from a string of recent US bank failures.

“I think Asean (Association of Southeast Asian) banks and more broadly, Asian banks, are well-capitalized,” HSBC Group cochief executive Surendra Rosha said in a media roundtable on Tuesday.

Marcos asks DBM to study projects as some LGUs incapable for full devolution

President Ferdinand “Bongbong” Marcos Jr. has asked the Department of Budget and Management (DBM) to review the projects and programs that will remain with the national government as some local government units (LGUs) signified that they are not capable yet for full devolution. Under Executive Order (EO) No. 138, the transition period before fully implementing the devolution of projects to the LGUs is until 2024. “The President asked us to study this and maybe make an amendment po sa ating (to) EO 138,” DBM Secretary Amenah Pangandaman said in a Palace press briefing on Tuesday.

‘P85/kilo sugar is economic sabotage’

Selling sugar at P85 a kilo is nothing less than large-scale agricultural smuggling and economic sabotage and is outrageous, Sen. Risa Hontiveros said yesterday. At a press conference at the Senate, Hontiveros lamented that selling sugar at P85 a kilo could mean a P32 per kilo profit, which she described as “nothing short of outrageous. It’s like winning the lottery 50 times on the super lotto without even putting a bet.”

Eastern Communications and partners champion women empowerment in the digital age

Premier telecommunications company Eastern Communications continues to demonstrate its dedication to empowering women professionals and leaders in the digital age as it celebrates National Women's Month with the help of its partner associations.

High inflation to dampen growth outlook — NEDA

Inflation could threaten the Philippines’ growth outlook this year and in 2024, National Economic and Development Authority (NEDA) Secretary Arsenio M. Balisacan said. “In the next two years, strong demand for consumption and investment will primarily drive the recovery. However, domestic risks to inflation may dampen this outlook if upward price pressures force the Bangko Sentral ng Pilipinas (BSP) to raise its policy rates,” he said at a virtual roundtable forum on Wednesday.

6.5M LOST THE PAST 3 YEARS: Jobs return but challenges remain

Some 6.5 million Filipino jobs were lost during the height of the lockdown and quarantine period of the pandemic, the World Bank reported yesterday. But while some jobs are coming back, challenges remain, according to the report. Yoonyoung Cho, senior economist, Social Protection and Jobs Global Practice, World Bank Philippines, professional jobs have returned, but struggles remain. Wholesale and retail and the service industries have rebounded, Cho said. “By the second quarter of 2022, the share of wage employment decreased while the share of unpaid family workers and self-employment increased,” Cho said. She added: “Poverty increased in 2021, reversing downward trends before the pandemic.” She highlighted major challenges, especially youth employment which is higher for this group than others.

AMLC flags risks from casino junkets

The Philippine government should strengthen measures to combat money laundering and terrorism financing in the casino sector, the Anti-Money Laundering Council (AMLC) said, citing increased suspicious transactions involving casino junkets. “The substantial volume and value of suspicious transactions associated with casino junkets underscore the junket system’s inherent vulnerability to money laundering and terrorism financing risks,” the AMLC said in a report. It said one data set showed there were 3,308 suspicious transaction reports related to casino junket operations from Sept. 21, 2018 to Jan. 18, 2023, with an equivalent value of P17.79 billion.

PH trade with 11 Asian markets to triple to $393B by 2030: study

Trade between the Philippines and 11 other Asian markets could triple by 2030, according to an industry study released by UPS. Titled Clearing the Runway for Intra-Asia Trade, the study said  UPS found that trade within these Asia 12  markets could more than double in value from $6.4 trillion in 2020 to $13.5 trillion in 2030. Today, trade in these so-called Asia 12   accounts for 88 percent of intra-Asia trade  and these markets are poised to consolidate this position further. These markets are China Mainland, Hong Kong, Japan, Malaysia, Philippines, Singapore, South Korea, Taiwan, Thailand, Vietnam, Indonesia and Australia. The study said the Philippines has an opportunity to build on rapid growth in the previous decade – particularly in the manufacturing sector – which could see trade with the Asia 12 more than triple from $113 billion in 2020 to $393 billion in 2030.

Philippine participation in CPTPP to benefit unskilled workers

Joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) could bring benefits to the country, particularly for unskilled workers, but may lead to lower economic growth as high value-added industries decline. This is according to a policy note published by the Philippine Institute for Development Studies and written by Ateneo de Manila University economics professor Leonardo Lanzona Jr. and members of the ADMU Economics Department-International Trade Research Laboratory. The study was conducted to determine the potential impact of CPTPP on the Philippines, which has expressed interest to join the trade deal in 2021.

Agricultural trade grows 5.1% in Q4 last year

The value of the country’s agricultural trade continued to grow but at a slower pace in the fourth quarter of 2022 to $6.32 billion, driven by a double-digit increase in agricultural imports, according to the Philippine Statistics Authority (PSA). The fourth quarter figure is lower than the 17.6 percent growth registered in the previous quarter and the 25.5 percent growth a year ago. Agricultural imports accounted for 75.5 percent of total agricultural trade in the fourth quarter, up 13.9 percent to $4.77 billion.

Senators recommend CAAP to have regulatory-only role

The Senate adopted on Wednesday a committee report recommending that the Civil Aviation Authority of the Philippines (CAAP) let go of its role of operating airports and focus solely focus on regulating aviation.

At the plenary session, the upper chamber adopted and approved with no amendments the findings and recommendations of the committee on public services in its inquiry into the New Year’s Day air traffic system shutdown that affected at least 65,000 travelers, and canceled, delayed or diverted some 600 flights.

BSP downshifts pace of rate hikes

THE BANGKO SENTRAL ng Pilipinas (BSP) slowed its pace of monetary tightening as it raised its benchmark rate by 25 basis points (bps) and signaled a likely pause at its next meeting in May. The Monetary Board increased the rate on the overnight reverse repurchase facility by 25 bps to 6.25%, as expected by 12 out of 14 analysts in a BusinessWorld poll last week. Interest rates on the overnight deposit and lending facilities were also hiked by 25 bps to 5.75% and 6.75%, respectively. Since May 2022, the central bank raised rates by a total of 425 bps, including 50 bps each at its last two meetings.

BCDA spearheads transit-oriented dev’ts 

The Japan International Cooperation Agency (JICA) and the Bases Conversion and Development Authority (BCDA) on March 21 signed a technical cooperation agreement for the development of areas in and around railway stations being built by the Department of Transportation (DOTr). BCDA said these sites are located in Fort Bonifacio and will serve as models of the Philippines’ transit-oriented developments (TODs), as well as prototypes of sustainable mixed-use communities with access to high-quality train systems.

Creative industry valued  at P1.6T in ’22, up 12%

Workers in the advertising, entertainment and media industries, collectively called “creative economy,” produced goods worth P1.6 trillion last year, about 7.3 percent of the country’s economic output, according to the Philippine Statistics Authority (PSA). The PSA said last year’s output is a 12.1 percent increase from the P1.43 trillion recorded value in 2021. The growth comes against the backdrop of a spending-driven election period which employed much of the goods produced in the sector to reach politicians’ target audiences.

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