Mia A. Aznar
Thursday, June 7, 2012
WITH many sectors jittery about an impending exit of Greece from the eurozone, Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco believes the events in Europe will have little impact on the country’s banking system.
Speaking before members of the Cebu Chamber of Commerce and Industry (CCCI), Tetangco said only 1.2 percent of the Philippine banking system’s total assets are exposed to the risks Greece’s exit might bring.
Tetangco admitted that the possibility of Greece leaving the eurozone is one of the “hottest topics” in the financial world, noting that EU officials wish to keep it intact.
Impact
He said the immediate impact on the global stage would be volatility in financial markets, which could end up in emerging market economies not having enough funding sources as banks could tighten their hold.
However, Tetangco told the business community that trade for the country could remain robust, although they are also wary of the fact that 13 percent of the country’s exports go to Europe and that 17 percent of overseas Filipino workers’ remittances are sent from that region.
He said they are mindful of these conditions and that the country will work out other markets for export products.
In the meantime, he congratulated the local business community of Cebu, saying the island province is a “showcase” of how trade and investment and technological improvements can open up markets and “produce a quantum leap” in growth potential.
“Cebu became a dynamic example of how collaboration between policy makers and the private sector could significantly increase opportunities for growth, not only to the province or the region, but also for the country as a whole,” he said.
Tetangco said Cebu contributed significantly to the growth of Central Visayas, which accounts for 20 percent of the country’s total gross domestic expenditures, the fifth largest in the Philippines.
He said that when it came to family income, Central Visayas ranked the third highest outside. of the National Capital Region.
Credit activity
As of latest figures, Tetangco said Central Visayas accounts for 16 percent of total bank deposits outside the NCR while the credit activity in the region grows at over 20 percent annually.
Of all the building permits issued in the country, the region accounted for 12,000 or 11 percent.
“In all this, Cebu is a significant driver that sustains the region’s economic upward trajectory,” he said, noting that the construction of hotels or new attractions such as beach resorts, restoration of heritage structures, putting up of new factories or furniture companies, opening of new business process outsourcing centers in its IT parks, or building of power plants are all possible due to the support of the private sector.
He said the local business community such as the CCCI is an “invaluable” asset to Cebu’s growth.
Published in the Sun.Star Cebu newspaper on June 08, 2012.
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