POSITIVE market perception of the country’s economy is expected to be evident in the later part of 2009 but the real and mainstream economic recovery is expected much later in 2010.
This was the forecast released by Security Bank Corp. (SBC) to its clients during a macroeconomic forum last Friday at the City Sports Club.
Rafael Algarra, senior vice president and treasurer of SBC, said he believes that the Philippine government’s target for a 3.7-percent to 4.7-percent growth for 2009 is “workable” after the National Economic and Development Authority bared its plan to release over P300 billion under the Economic Resiliency Plan.
“But the stimulus package must be spent as early as possible,” Algarra told reporters.
The biggest worry concerning the resiliency package, however, is red tape, he added.
As 2010 is election year, spending by politicians during the period will also help the economy stabilize. “Election is a natural fiscal stimulus,” he said.
Although Algarra does not see an economic recovery in the United States within the year, he said people in the US will realize that the “the worst is over” and soon, consumer spending confidence will return.
Still, Algarra advised businessmen to continue watching what the American government will be doing since offshore activities will continue to affect the country, especially those who are in the export business.
This year, Algarra said, the agriculture sector—being a beneficiary of the stimulus plan—will do well together with the services sector. But the same is not true for the financial services, he added.
He said it is also possible for business process outsourcing firms to pursue expansion plans this year as most American companies are expected to continue cutting costs and outsourcing certain functions.
Remittance volume of overseas Filipino workers (OFW) is likely to have a flat growth this year as several OFWs have been displaced. But OFW re-mittances will remain above $16 billion. (DME)
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