STANDARD Chartered Bank (SCB), the oldest international bank in the country, foresees 2013 as a year of transition for the global economy and an opportunity for the Philippines to take off.
In a recent economic briefing organized by Autowelt Inc. at the BMW Showroom in Lahug, Cebu City, SCB assistant vice president Harold Brian Loseo Tan presented the bank’s projection that 2013 is likely to be a year of transition to strong growth in 2014.
“US and Europe used to bring the world economy out and provided a footing for global growth but nowadays, China is a major player. At no other time in Asian history has emerging Asia, including the Philippines, become such a significant contributor to global economic growth. There’s a lot of growth potential for us, moving forward,” he said.
Tan credits the local growth to good governance, particularly transparency in accommodating foreign investments, and a strong peso.
A strong external position as a nation and continued foreign inflows also support the Philippine economy.
Modest increase in spending
In his presentation, he discussed that although inflation pressures are likely to be muted, with an expected average of 3.9 percent this year from 3.2 percent in 2012, investments will boost imports this year.
The country can look forward to a modest increase in consumer spending and a gradual growth of government expenses. Tan also pointed out that the strength of a local economy is shown by its stock market and currency.
He pointed out that the Philippine Stock Exchange index (PSEi) last month breached the 6,000 level for the first time.
He also agreed with expectations that the peso will hit P39 to the US dollar within the year. Forecasting GDP growth of 5.8 percent for 2013 and 6.2 percent for 2014, the bank is confident the Philippine economy will boom this year buoyed by the increasing remittances from overseas Filipino workers (OFW) and Filipino investors, and with the country moving into manufacturing.
The Bangko Sentral ng Pilipinas reported last week buoyant business confidence for the country in the first quarter of 2013. The vibrant outlook is buoyed by expectations of election-related spending, the harvest season, graduation and enrollment periods, the expected rise in tourism during the summer, and business expansions.