ECCP at Work

PH inflation soars to 7.7% in October

Four months into the Marcos administration, consumer prices continued to surge, hitting 7.7% in October, the Philippine Statistics Authority (PSA) reported Friday. Data from the PSA showed inflation rose to 7.7% anew last month, from 6.9% in September. October's inflation rate is within the 7.1% to 7.9% forecast range of the Bangko Sentral ng Pilipinas for the month. The central bank earlier said the continued rise in fuel and agricultural prices and the weakening of the peso may trigger inflation to rise again.

PH to ratify ILO Convention to continue EU-GSP+ status — DTI

The Philippines is working on the ratification of the ILO Convention 81 on Labor Inspection, one of the six proposed additional conventions by the EU Commission for a trading partner to continue enjoying the EU-Generalized System of Preferences+ (EU-GSP+). According to Gepty, the Department of Labor and Employment (DOLE) is working on the usual process. After getting all the concurrence of agencies, he said, the Department of Foreign Affairs (DFA) will assess if ratification can be done via executive agreement or treaty. For the new EU GSP+, he said, the Philippines will pursue the same as it will not only maintain the country’s comparative advantage in the EU market but it can further boost the country’s exports as well encourage more investments in the country. At present, the Philippines is the only ASEAN Member State enjoying such privilege in the region

 DTI highlights PH's role in Asean trade

TRADE Secretary Alfredo Pascual highlighted the critical role of the Philippines in trading among the members of the Association of Southeast Asian Nations (Asean) as the country seeks to further develop partnerships to boost the local economy. The DTI chief emphasized that the Philippines remains one of the strongest performers in the region despite the global economic disruption brought by the pandemic. With its strategic location in the Indo-Pacific area, the Philippines has a growing potential as the center of trade and commerce, he noted. In promoting an enabling environment for foreign businesses, the Philippines has implemented the Ease of Doing Business Law and made amendments to the Public Service Act, Retail Trade Liberalization Act and Foreign Investments Act.More opportunities are offered by several free trade agreements in place such as the Asean Trade in Goods Agreement, Philippines-Japan Economic Partnership Agreement, Philippines European Free Trade Association Agreement as well as the incentive arrangement for Philippine exports under the EU GSP+. DTI also looks forward to the ratification of the Regional Comprehensive Economic Partnership that will further expand the market access of Filipino products and boost exports.

PH debt soars to ₱13.52T in September

The Philippine government's outstanding debt took a hit from the free fall of the peso against the US dollar as it ballooned to an all-time high of ₱13.52 trillion in end-September, data from the Bureau of the Treasury showed Thursday. According to BTr, the national government's total debt rose by 3.8% or ₱495.54 billion for the month as the local unit continued to weaken against the greenback, coupled with the issuance of securities to boost the budget. For the first nine months, the national debt increased by ₱1.79 trillion or 15.2% since December 2021. The bulk, or ₱9.30 trillion, of the outstanding obligations, was raised from local sources. Domestic debt increased by 13.8% from the beginning of 2022. Loans with foreign sources, meanwhile, also jumped to ₱4.22 trillion, 3.4% higher from end-August's level. From end-December, foreign debt has already climbed by ₱18.5% or ₱658.30 billion. 

DOLE lets employers, workers decide whether to mask up at work

The Department of Labor and Employment is leaving it up to employers and their workers to decide whether they will continue to wear masks at work after President Ferdinand Marcos Jr. scrapped the mask mandate. In Labor Advisory No. 22, Labor Secretary Bienvenido Laguesma said employers and their workers may require the wearing of face masks taking into account hazards and risks, industry requirements and incidence of other infectious diseases. Marcos made masking optional in both indoor and outdoor settings in an effort to boost tourism in the country as officials pointed out that the Philippines still had stringent mask rules compared to its Southeast Asian neighbors. This is despite the continued warnings of the Department of Health, which chairs the pandemic task force, that lifting the mask mandate may result in more COVID-19 infections.

Easing of inbound travel restrictions OK’d to boost tourism

To allow the Philippines’ tourism sector to catch up with that of neighboring countries, President Marcos has approved the recommendation of the government’s pandemic task force to further relax travel restrictions for inbound travelers. Executive Secretary Lucas Bersamin, in a memorandum dated Oct. 28, said the President approved the Inter-Agency Task Force for the Management of Emerging Infectious Diseases’ Resolution No. 2, recommending the lifting of pre-departure testing requirement for fully vaccinated arriving passengers, whether Filipinos or foreign nationals. Filipino and foreign nationals shall be deemed fully vaccinated if he or she had received the second dose of a two-dose series or a single-dose COVID-19 vaccine more than 14 days prior to the date and time of departure from the country of origin or port of embarkation, according to IATF Resolution No. 2, dated Oct. 4. In the memo, the Palace directed the Bureau of Quarantine to coordinate with the DOH and other concerned agencies to identify the other acceptable proofs of vaccination in order to avoid confusion and inconvenience on the part of inbound travelers, and facilitate dissemination thereof for public information.

October factory output growth slows

Factory output in the Philippines expanded at a slower pace in October, reflecting a modest uptick in new orders despite elevated inflation and supply chain disruptions, S&P Global said on Wednesday. The S&P Global Philippines Manufacturing Purchasing Managers’ Index (PMI) stood at 52.6 in October, lower than 52.9 in September. Despite the slightly slower expansion, S&P Global said the Philippine index was still above the historical average. A PMI reading above 50 denotes better operating conditions than in the preceding month, while a reading below 50 signals the opposite. The Philippines recorded the highest PMI reading among six Southeast Asian countries, followed by Indonesia (51.8), Thailand (51.6) and Vietnam (50.6).  Manufacturing activity in Malaysia (48.7) and Myanmar (45.7) contracted in October. On average, the Association of Southeast Asian Nations (ASEAN) headline PMI stood at 51.6 in October, easing from 53.5 in September.

UNDP zeroes in on human development to-do’s for PHL

The Philippines should focus on critical areas of human development such as climate-resilient infrastructure and education to help boost its recovery from the coronavirus disease 2019 (COVID-19) pandemic, a United Nations Development Programme (UNDP) official said. The Philippines ranked 116th out of 191 countries in the latest UNDP Human Development Index, down three places from 113th.The index ranks countries based on three dimensions of human development: a long and healthy life, knowledge and a decent standard of living. With a score of 0.699 out of 1, the Philippines was below the East Asia and the Pacific’s average of 0.749 and the global average of 0.732.

Philippines digital economy now worth P1.87 trillion

The value of the country’s digital economy rose eight percent in 2021 from a year ago as digital adoption continued amid the pandemic. Data from the Philippine Statistics Authority (PSA) showed the Philippine digital economy’s value reached P1.87 trillion last year, higher than the P1.73 trillion in 2020. The PSA said the digital economy contributed 9.6 percent to the country’s economy or gross domestic product last year.The digital economy is composed of digital transactions covering digital-enabling infrastructure, e-commerce, and digital media or content.

 PH manufacturing growth slowed in Oct

The domestic manufacturing sector continued to expand but was slightly less active after three consecutive months of improvement, with the S&P Global Philippines Manufacturing PMI (purchasing managers index) easing to 52.6 in October from 52.9 in September. Inflation in the Philippines was pegged at 6.9 percent in September, and the BSP thinks it will slowly go down in the succeeding months after breaching the 7-percent level in October. Maryam Baluch, an economist at S&P Global Market Intelligence, said that despite the slower pace in September, companies continued to increase capacity and stocks to support future growth. According to S&P Global, overall factory orders increased in October, but volumes of new work from abroad contracted at the sharpest pace since the recent sequence of decline began in March. PMI for October was lower than September. 

House bill aims to revitalize local salt industry

A senior administration lawmaker has filed a bill in the House of Representatives that aims to revitalize the country’s salt industry through a “comprehensive salt industry development program” that will do away with massive salt importation. Rep. Ron Salo of party-list Kabayan, chairman of the House committee on overseas workers affairs, authored and sponsored House Bill 1976 in an attempt to make the Philippines self-sufficient in salt production. Salo highlighted the classic irony where the Philippines imports around 93 percent of the country’s salt requirement, despite having 36,000 kilometers of shoreline – the fifth longest shoreline in the world – that can be utilized for massive salt production. HB 1976 tasks the government to provide technical, physical and financial assistance to sea salt farmers, including artisanal salt farmers, to develop and improve their craft.It also mandates the government to invest in the identification and construction of salt farms for lease to qualified salt farmers, whether individuals, cooperatives, or corporations.

Gov’t rushes to avert EU ban on PH seafarers

President Marcos has removed from the Maritime Industry Authority (Marina) the task of overseeing maritime training and accreditation after the country repeatedly failed to pass the European Maritime Safety Agency’s (Emsa) evaluation in the past 16 years. Around 50,000 Filipino seafarers working in European vessels are reportedly at risk of losing their jobs since the Emsa has given a final deadline this month for the country to address the concerns raised by Emsa. The Philippines is a top source of certified seafarers in the world and these Filipino maritime workers send about P376 billion in remittances annually. As a consequence of the Russia-Ukraine conflict, Ople said EU shipping companies have turned to Filipino seafarers to make up for the shortfall since Ukraine could not supply seafarers anymore. Before Russia’s invasion in February this year, Ukraine was the world’s sixth biggest supplier of seafarers. The European Union recognized the Philippines’ maritime education, training and certification in 2002, allowing Filipino seafarers to work in EU-flagged vessels.The Philippines has repeatedly faced since 2006 the possibility of a ban by the European Union on the hiring of Filipino seafarers after Emsa perennially raised concerns about the country’s compliance with international seafaring standards.

BSP to match US Fed's aggressive rate hikes this November

 The Philippines will keep pace with the US Federal Reserve's move raising interest rates by 75 basis points (bps) this November to soften the impact on the peso and beat inflation, the central bank's chief said Thursday. Bangko Sentral ng Pilipinas (BPS) Governor Felipe Medalla said they would increase the policy rate by the same amount after the Monetary Board meets on Nov. 17. Once it takes effect, this would bump up the key interest rate to 5%. This comes following Fed's decision to further hike interest rates to control soaring prices. Increasing interest rates impacts how consumers access loans as banks and lending companies shadow the BSP's rates for their loan, credit card, and deposit interests. This would mean Filipinos wanting to own new cars, houses, or business capital, among others, would have to deal with more costly borrowings. In turn, businesses and consumers are seen to save more and spend less. The BSP said the October inflation rate might accelerate anew, settling between 7.1% to 7.9% way faster than September's 6.9% as Filipinos continued to grapple with fuel and agricultural price hikes.