THE Philippines was
seen to weather the after-effects of an economic storm resulting from
the exit of any member of the 17-nation euro zone, the local central
bank, the Bangko Sentral ng Pilipinas (BSP), said on Thursday.
According
to BSP Governor Amando M. Tetangco Jr., the country’s macroeconomnic
underpinnings are such that the likely exit of Greece from the European
Union, for instance, should not prove disruptive.
“I think we’ll be
able to absorb any shock that can arise from that because we have
sources of resilience we have described in the past,” Tetangco said.
A
Greek exit from the euro zone was certain to affect the Philippines via
its trade and foreign exchange channels but their impact should not be
very damaging, he said.
“From
the standpoint of the Philippines, the euro zone can be likened to a
pain in your shoulders. It’s there and you can feel it, but it doesn’t
cripple you,” Tetangco said.
According
to Tetangco, depending on how such exit plays out and the level of
uncertainty it generates among the various market players, its
after-effects should be limited to a confined space.
The euro zone was not likely to disappear, its problems will remain and some fear a likely contagion, he said.
“There will be hiccups here and there, but the core economies like Germany should still do well,” he said.
Tetangco also ruled out a collapse of the euro zone economy.
He
said the euro-zone accounts for more or less 16 percent of total
remittances sent by millions of overseas Filipinos to families in the
Philippines every year and 12 percent of the country’s export receipts.
Even the banking system has basically shrugged off the zone’s economic woes.
“Our
banks continue to be stable and continue to perform well in terms of
asset growth, profitability and credit quality,” Tetangco said.
Loan
default rates, for instance, is low at only 2.34 percent of total loans
even as loan take-outs continue to rise to fund consumption as well as
productive undertakings.
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