ECCP at Work

‘Global shocks’ may weigh on PHL growth in 2023 — IMF

The Philippine Economy is still expected to remain one of the strongest performers in the region next year, although it may face “shocks” arising from a looming global economic slowdown, an International Monetary Fund (IMF) official said. In its latest World Economic Outlook, the IMF kept the gross domestic product (GDP) growth forecast for the Philippines unchanged at 6.5% this year and 5% in 2023. The government targets 6.5-7.5% GDP growth for this year, and 6-8% growth for 2023 to 2025. The inflation accelerated to 6.9% in September from 6.3% in August. It marked the sixth straight month that inflation breached the Philippine central bank’s 2-4% target this year. The Bangko Sentral ng Pilipinas (BSP) has raised benchmark interest rates by 225 basis points (bps) this year to tame inflation.

PHL posts record trade gap in Aug.

The Philippines posted its biggest single-month trade deficit on record in August as imports surged while exports slowed for a second straight month. The value of merchandise exports shrank by 2% year on year to $6.410 billion in August, a reversal from the 18.9% growth in the same month in 2021, preliminary data from the Philippine Statistics Authority (PSA) showed.On the other hand, merchandise imports rose by 26% to $12.413 billion in August, slightly slower than the 28.3% growth in August 2021 but faster than the 22.2% in July. Total trade — the sum of exports and imports — grew by 14.8% to $18.823 billion in August. This pace was faster than the 11.8% in July but slower than the 24.4% in August 20. Meanwhile,  Electronic products which made up 69% of manufactured goods and more than half of total exports that month, fell by 1.6% to $3.660 billion. Three-fourths of electronic product sales came from semiconductors, which decreased by 0.1% to $2.738 billion.

Expensive imports drive Philippine foreign trade in August 

The Philippines’ external trade grew 14.8% year-on-year to $18.82 billion in August, data from the Philippine Statistics Authority released Tuesday showed. This was faster compared to the 11.8% annual growth rate in July. Broken down, exports slumped 2% year-on-year to $6.4 billion in August. The country’s top export, electronic products, inched down 1.6% annually to $3.7 billion in August. Imports grew at a faster clip of 26% year-on-year to $12.41 billion in August on the back of expensive fuel shipments. The country’s trade deficit, which occurs when imports bill outgrows export sales, totaled $6 billion in August, higher by 0.21% than the previous month. The trade gap widened 81.3% on an annual basis. 

‘Philippines may be nearing COVID-19 endemic stage’

An infectious diseases expert said that the country could be nearing the COVID-19 endemic stage as cases are now on a downward trend and severe and critical infections remain low. Solante, head for Adult Infectious Diseases and Tropical Medicine at the San Lazaro Hospital, also noted that the country’s healthcare utilization rate continues to be stable at less than 50 percent. However, Solante said the country still needs to strengthen its health protocols, including intensifying efforts for vaccination before endemicity sets in. 

Palace commissions maritime industry dev’t plan

In a news briefing, acting Press Secretary Cheloy Velicaria-Garafil said Mr. Marcos issued the order during a Cabinet session in which the DoTR presented its plans for the maritime and aviation industries. The President ordered the DoTr to focus on port upgrades to attract cruise ship visits and to upgrade the maritime education and training system, she said. Mr. Marcos also ordered the DoTR to upgrade Metro Manila’s gateway airport and consider unsolicited proposals to modernize other airports in a manner that will “respond to increasing demand,” Ms. Garafil said. On Monday, Transport Secretary Jaime J. Bautista said the government aims to complete regional airport projects worth P1 trillion by next year. He said public-private partnerships will play a key role in the Marcos administration’s infrastructure program

New BOT Law IRR in effect

The revised implementing rules and regulations (IRR) for the Build-Operate-Transfer (BOT) Law took effect on Wednesday, which the Finance department hopes would help the Philippines attract more private investments in infrastructure project. The IRR was amended in response to criticisms by business groups that the previous version of the rules compels private proponents to shoulder more risk while relieving the government of responsibility for delayed deliverables. Mr. Diokno said the new rules will be crucial in unlocking the benefits of PPP, as well as “reap higher multiplier effects for the economy.” Meanwhile, PPP Center Executive Director Ma. Cynthia C. Hernandez said the amended rules will boost PPP projects.

Vehicle sales still on high gear in September as demand picks up

A joint report by the Chamber of Automotive Manufacturers of the Philippines Inc. (Campi) and the Truck Manufacturers Association (TMA) showed automobile firms sold a combined 35,282 units in September, gaining by 64.2 percent from the 21,493 units sold in the same month last year. Back in August, unit sales surged by 90.5 percent – the highest so far this year – to reach 30,185. The September sales brought total units sold in the first nine months to 248,154, a healthy 29.5-percent growth from sales in the same nine-month period in 2021. In an interview with reporters last month, Gutierrez expressed optimism that the local automotive industry will hit its target this year, banking on consumer spending to pick up as the holiday season approaches. The global outbreak of the coronavirus pandemic almost three years ago hit the local car industry hard, with local automobile firms going from a yearly sale of 369,941 units in 2019 to 223,793 units in 2020—The Philippines went from producing 95,094 vehicle units in 2019 to just 67,297 in 2020.

World Bank ready to boost support for Philippines development goals

The World Bank is ready to provide greater support for the Philippines to help the country achieve development goals, the bank’s top official said. The multilateral lender said it is prepared to increase support particularly in the areas of agriculture, tourism, water, energy and education.  During the meeting, Malpass and Diokno exchanged views on the country’s growth and vulnerabilities, as well as the upcoming World Bank Country Climate and Development Report for the Philippines. The report, which will cover climate change and development considerations, is expected to help prioritize actions, reduce greenhouse gas emissions and boost adaptation, while delivering on broader development goals.

Neneng likely to intensify, to bring heavy rains in northern Luzon

Tropical depression Neneng is likely to intensify further, the state weather bureau said early Friday, adding it is projected to bring heavy rains in northern Luzon.The weather agency said that beginning Saturday, the tropical cyclone may bring heavy rains in northern Luzon where Tropical Cyclone Wind Signal No.1 may also be raised due to strong breeze to near gale strength winds. Neneng is expected to make landfall or may pass very close to Babuyan Islands or Batanes, PAGASA said.