Global slowdown to create ‘unique opportunity’ for RP

By Ma. Elisa P. Osorio
Monday, October 13, 2008

Local business leaders said the slowdown in the US economy will create a unique opportunity for the country because the Philippines is an attractive investment destination.

Philippine Chamber of Commerce and Industry (PCCI) chairman Sergio Ortiz-Luis said most multinational companies are now looking for alternative business locations as labor and operating costs in the United States soar.

He said there are multi-national companies that are now pulling out their investments in developed nations and are looking at setting up businesses in other countries in order to reduce cost.

“Because of risk aversion, there is a big possibility that these companies will go to us,” he explained.

Ortiz-Luis said people need not panic over the global economic turmoil because developing countries like the Philippines are somewhat insulated. He said those that will really feel the impact are developed nations. In fact, he said the country is expected to continue to grow until next year.

“Of course we have to be concerned but we can get out of this crisis better than other nations,” he noted.

He said the country is doing alright this year. In terms of exports, however, he stressed that there is a need to re-asses the expectations for next year because even countries like Singapore which was not expected to be affected are already experiencing the effects of the global slowdown.

Ortiz-Luis said it is important that people like some politicians should avoid making pronouncements regarding the economy which may cause undue panic.

“This is a perception game. I call on the politicians, if they have nothing good to say then they should keep it to themselves,” he said.

For him, perception will dictate how the country will be affected by the economic crisis happening in the United States and other countries in Europe. He said the government and the private sector are already doing their part to manage the situation.

PCCI president Edgardo Lacson agreed with Ortiz-Luis, saying it is important for people not to panic. “Panic can lead to total collapse.”

“If we panic and we do things that are hurtful to our economy then it is a self-fulfilling prophecy,” Lacson noted.

An example is withdrawing money from banks even if there is no cause for alarm. Mass withdrawals can cause the collapse of even strong banks. “Yes we are concerned about what is happening around us but we are solving it,” he said.