Philippines on track to achieve upper middle-income status by 2025
National Economic and Development Authority Arsenio M. Balisacan said that the country remains on track to achieving an upper middle-income status in 2025 which may be attributed to a higher economic growth, as measured by GDP, and slow population increase.
Philippine GDP likely grew by 6.1% in the first quarter amid an improvement in government spending, economists said. If realized, the 6.1% GDP growth would be slower than the 6.4% logged in the first quarter of 2023, but faster than 5.6% in the fourth quarter. In 2023, the economy grew by 5.6%, much slower than the 7.6% expansion in 2022 and fell short of the government’s 6-7% target.
New taxes ‘last resort’ — Recto
“It is incumbent upon this administration that its last resort should always be to increase taxes,” Finance Secretary Ralph G. Recto said. Asked if there is a chance that there will be no new tax measures until the end of the administration, Mr. Recto said: “There is a possibility. I think we should try first to collect what’s there. There are so many leakages.”
Single-use plastics tax seen generating up to P34 billion
The DoF said its proposal to impose excise taxes on single-use plastic bags could yield up to P33.856 billion in the first five years of implementation. The DoF estimates that the proposal will generate P2.334 billion in its first year of implementation, followed by P6.96 billion in the second year, P7.412 billion in the third year; P8.162 billion in the fourth year; and P8.988 billion in the fifth year.
PH turning into investment magnet
“If we look at FDI inflows relative to the size of the economy, the Philippines is, in fact, in the middle of the pack in Asean (Association of Southeast Asian Nations),” HSBC said. ”FDI inflows may not be as robust as say, Malaysia and Vietnam, but they are a sizable improvement from the sluggish inflows seen in the 1990s and the early 2000s. This, we believe, should be enough evidence to show that the country’s reputation [for] attracting FDI is, indeed, turning for the better,” it added.
Cha-cha to make PH $2-t economy—solon
Rep. Luis Raymund Villafuerte appealed to the senators to prioritize passage of their resolution on economic Charter change “to achieve the conditional prospect of the Philippines becoming a $2-trillion economy comparable to Canada, Italy and Brazil. Villafuerte said such economic growth is projected by the World Economic Forum (WEF) based on what it called the Philippines' status as the region’s fastest-growing economy.
The IRR of the PPP Code will be flexible to adopt to the changing times, according to Secretary Frederick Go of the Office of thea Special Assistant to the President for Investment and Economic Affairs (OSAPIEA). Go encouraged developers to take a look at the 185 infrastructure flagship projects worth over P9 trillion of the government “because these infrastructure projects are highly related to real estate and you might find some of them interesting..”
World Bank to share more data to attract private investors to developing countries
The World Bank will publish more of its proprietary data, including on debt defaults, starting next week as part of a push to attract more private sector investment to developing countries, World Bank President Ajay Banga said. The World Bank would also publish private sector default data broken down by credit rating, as well as sovereign default and recovery rate statistics dating back to 1985, he said.
Foreign partners, tech, simpler tax system seen to boost PHL mineral sector
“Getting investments and processing technology from other countries should be a key consideration for the government if it wants to develop a competitive domestic mineral processing industry,” Ronald S. Recidoro, executive director of the Chamber of Mines of the Philippines (CoMP), said.
Ports repurposing for offshore wind may cost $80 million — DoTr
The Department of Transportation (DoTr) said repurposing ports for offshore wind development will cost around $80 million. The DoTr has started the study, Mr. Sarmiento said, adding that the agency expects to release the roadmap for ports development in the next two to three years. Freight flow surveys are part of the study to determine if ports are suitable sites for offshore wind development.
DOF pushes for excise tax on single-use plastic bags, a win-win solution to address climate change
The DOF proposes a weight-based rate for easier and fairer tax administration wherein a PHP 100 per kilogram excise tax on SUP bags will be imposed with a 4% annual indexation beginning the third year of implementation. Under the DOF’s proposal, the price of labo bags per piece will slightly increase from PHP 0.47 cents to PHP 0.82, while sando bags will be priced at PHP 0.51 to PHP 0.91 each.
IBPAP hoping to unlock new markets through EU-PHL FTA
An FTA between the Philippines and the European Union (EU) is expected to help unlock new markets for the information technology and business process management (IT-BPM) sector, IBPAP President and Chief Executive Officer Jack Madrid said. “Free trade is always a good idea. (Our market in Europe) is growing, but I would like it to be bigger. We’re still dominated by North America,” he noted.
MOA crafting 3rd phase of gas policy signed
Natural gas resource development in the country is expected to further improve after the DOE signed a memorandum of agreement (MOA) with the University of the Philippines Statistical Center Research Foundation Inc. for the third phase of the Gas Policy Development Project (GPDP). The GPDP aims to provide technical assistance in implementing a circular setting the codes of standard, rules and regulations governing the country’s downstream natural gas industry.
PSALM corporate life should be extended — Finance chief
The corporate life of state-run Power Sector Assets and Liabilities Management Corp. (PSALM) should be extended as it still has debts and assets, Finance Secretary Ralph G. Recto said. He said that PSALM’s corporate life may possibly be extended for another 25 years.
Infra, governance seen as more critical to FDI than charter reform
While ease of doing business policies and a well-managed economy are important factors for foreign investors, Mr. Rivera, president and chief economist at Oikonomia Advisory & Research, Inc., said that “good housekeeping and good governance” are also key considerations for foreign investors. He added that the Philippines should also have “excellent infrastructure” to further attract foreign investment.
Gross borrowings slump in Jan.
Data from the BTr showed that total gross borrowings declined by 44.6% in January from the P366.863 billion in the same month in 2023. During the month, domestic borrowings accounted for more than two-thirds or 69.7% of the total. Gross domestic debt stood at P141.505 billion in January, a 21.1% drop from the P179.3 billion seen a year ago.
Inflation uptick may delay rate cuts
A potential uptick in inflation over the next few months could prompt the Bangko Sentral ng Pilipinas (BSP) to delay its rate easing cycle, analysts said. “This could keep the BSP from cutting rates as anticipated by market players. If inflation persists, they might not cut at all,” Jonathan L. Ravelas, senior adviser at professional service firm Reyes Tacandong & Co., said.
DOE monitoring grid operations for probable power service interruptions
As the country’s power supply is still at its wobbly state, the Department of Energy (DOE) guaranteed that it will conscientiously monitor the overall operations of the power grid so consumers can be alerted on any service interruptions and for relevant industry players to correspondingly sort out immediate solutions in case of unwanted blackouts.
Luzon grid could experience yellow alert in April, May
In a statement, the DOE said that yellow alerts may occur in April and May in the Luzon Grid as hydroelectric power plants operate at reduced capacity levels. Energy Secretary Raphael P.M. Lotilla said the summer season places significant strain on electricity demand, particularly due to increased cooling needs, resulting in peak shifts in consumption and stress on infrastructure.
Bosch Solidifies Collaboration with Ayala Group's Mobility Arm
AC Industrials and Bosch Philippines signed an agreement that seeks to explore new business opportunities for the mutual benefit of both parties and development of the Philippines market. The groups intend to explore potential business activities in various industries, including mobility solutions, manufacturing, energy, and healthcare, among others. The agreement was witnessed by Philippines President Ferdinand R. Marcos Jr.
Philippines-European Union FTA talks resume in H2
“The formal face-to-face negotiation would be around the early second half of the year, around the third quarter because of preparatory work to be conducted,” Trade Secretary Alfredo Pascual said. Last week, Pascual and European Commission executive vice president and trade commissioner Valdis Dombrovskis announced the resumption of talks between the Philippines and the EU soon.
Gov’t mulls over PPP route for wind projects near seaports
The government may seek the help of the private sector in building offshore wind projects near seaports given the substantial funding requirement, according to an official of the DOTr. DOTr Undersecretary for maritime sector Elmer Sarmiento told reporters last week the government was mulling over using the PPP route for the projects, which could cost around $80 million or about P4.5 billion each.
Recto sees two rate cuts this year
The BSP may cut interest rates by 50 basis points (bps) this year, Finance Secretary Ralph G. Recto said. “Possibly, 50 bps (this year). Maybe two (cuts). This is just my expectation,” he told reporters in mixed English and Filipino on the sidelines of an Economic Journalists Association of the Philippines event last week. “Last quarter last year, we were looking at four adjustments this year. Maybe it’s now just two,” he said.
BoI pitches green metals investments to US, Canadian, Australian companies
The BOI has invited US, Canadian, and Australian firms to invest in Philippine green metals and mineral processing operations.“With its strategic location and abundant human and natural resources, the country aims to emerge as the preferred destination for priority sectors such as electric vehicles (EVs), smart manufacturing, semiconductors and electronics, green metals, high-tech agriculture, renewable energy (RE), and data centers or telecommunications,” the BoI said.
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