Pinoy businessmen see 7% GDP growth in 2013

Published on Wednesday, 12 December 2012 20:52

Written by Max V. de Leon / Reporter

FILIPINO businessmen are bullish about the country’s economic prospects for next year, projecting up to 7-percent growth in gross domestic product (GDP) for the whole of 2013.

Lawyer Miguel Varela, president of the Philippine Chamber of Commerce and Industry (PCCI), said on Wednesday that driving the growth for next year would be new investments, public-private partnership projects and election spending.

“A 7-percent [GDP] growth can be easily achieved,” Varela added.

But he expressed apprehension over the “overvalued” peso, which he said could restrict a faster economic growth because of its ill effects on the buying power of overseas Filipino workers and their families, as well as the export sector.

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Also, according to Varela, the only factor that may turn the tide against the Philippine economy is a sudden drastic change in policies that would affect the improving investor confidence in the country.

Sergio Ortiz-Luis, president of the Philippine Exporters Confederation Inc., said businessmen dread policy flip-flops, which, he added, characterized the previous administration, and remained as a major reason the country has not matched its Southeast Asian neighbors in terms of foreign direct investment inflows.

“Next year we can grow at least 5 percent to 6 percent, and if we are lucky, even 7 percent. But we should be careful,” Ortiz-Luis added.

The economy outperformed expectations in the first three quarters of 2012 with a 6.5-percent GDP growth, capped by a 7.1-percent increment in July to September.

Alfredo M. Yao, PCCI chairman, said business is feeling the effects of the improving economy but more improvements on the policy side are needed to sustain the growth.

“Now is the time to grab the opportunity and make it sustainable,” Yao added.

Donald Dee, vice chairman of PCCI, said 2013 should be devoted to the preparation of the different sectors of the economy for the borderless regime in the Southeast Asian region by 2015 and make them competitive.

He added that focus should be on policies and programs that will address the country’s high cost of power and doing business and industrial competitiveness.

“We have three years to prepare for the Asean economic community. Energy cost should go down, as well as logistics, which is tied to infrastructure, and utilities. We need clear industrial policies to get back the light industries like garments,” Dee said.

Association of Southeast Asian Nations (Asean) groups the Philippines, Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand and Vietnam.

Dee said the government should also manage the appreciation of the local currency as the strong peso is making imported products cheaper, thus, diminishing the ability of domestic industries to compete.

With local manufacturers losing their competitiveness, the eventual result is shedding of jobs, he added.

Ortiz-Luis said the Bangko Sentral ng Pilipinas and the Department of Finance have over a hundred of weapons in their arsenal to manage the appreciation of the “overvalued peso.” Among these are the regulation of special deposit accounts and portfolio investments and payment of foreign loans.