Tuesday, February 14, 2006

Hey, optimistic numbers on Philippine economy are showing up!

It seems like the Philippine economy is producing some encouraging numbers lately. The revised composite leading economic indicator from the National Statistical Coordination Board says the economy continues to expand in the first quarter. The LEI is a sort of early warning system devised by both the National Economic Development Authority to forecast the short-term trajectory of economy. The latest export statistics from the National Statistics Office shows the December 2005 exports growing at 17 percent because of the much-improved performance of the country’s top ten exports, including electronics, garments, coconut oil, petroleum products, ignition wiring sets, bananas, metals, woodcraft and furniture, and pineapples. Is this a foretaste of things to come in the export sector? I keep my fingers crossed.

The Bangko Sentral ng Pilipinas has just released a report showing that the dollar remittances of overseas Filipinos coursed through the formal financial system jumped 25 percent in 2005 to reach $10.7 billion. That means we are going to see a continuing rise in domestic consumption, assuming inflation rate—which has been modest so far—wouldn’t shoot through the roof with the recent implementation of the expanded value added tax. Last week the Makati Business Club released its report saying that the country’s business sector remains “optimistic” about the prospects of the economy despite their continuing concern about corruption in government. The other day, Fitch, a credit rating agency, upgraded the Philippines’ debt rating outlook from negative to stable, implying a reduced cost of borrowing for both the public and the private sectors. Incrementally, some good things are showing up and it would be unfair not to recognize them.

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