SKEPTICAL Filipinos may continue to delude themselves into believing that the Philippines is still a backwater nation plagued by traffic problems, Metro Rail Transit Line 3 breakdowns and heavy rains that caused even the famous Ayala Avenue-Makati Avenue intersection to be inundated, but economic figures continue to show that the country’s economy is still vibrant.
This was what Socioeconomic Planning Secretary Arsenio M. Balisacan impressed upon Japanese businessmen several days ago during a talk held at the Shangri-La Hotel in Chiyoda-ku, Tokyo. In the talk, the Philippines’s economic renaissance is seen to involve receiving huge investments in 952 infrastructure projects worth $45.69 billion until 2016 to address not only poverty incidence, but also the Filipinos’ quality of life.
The addition of quality of life as an indicator is meant to ensure that economic growth will be inclusive. This is different from the other indicator, poverty, which is loosely defined as a state in which income is lacking.
“By monitoring these two indicators, we demonstrate our commitment to ensuring that economic growth will benefit all, and that a better quality of life will be experienced by the poor,” Balisacan told his Japanese audience.
To explain how robust the Philippines and its economy are, in spite of what the skeptics say, Balisacan said that, from 1991 to 2001, the economy climbed an average of 2.9 percent, which increased to 4.8 percent between 2001 and 2010. Under the Aquino administration, the economy even grew an average of 6.3 percent, indicating that the country is progressing on a more sustainable growth path.
In fact, the country’s gross domestic product (GDP) grew by 6 percent, in real terms, in the first semester of 2014, despite the destruction wreaked by Supertyphoon Yolanda (international code name Haiyan) last November. For this year, the economy is expected to grow by 6.5 percent to 7.5 percent, 7 percent to 8 percent in 2015 and 7.5 percent to 8.5 percent in 2016. This means lifting more of the poor out of poverty.
Mediocre construction
THERE is a lengthening Facebook thread about the problems a media personality is having that stemmed from a longtime housing-industry player’s mediocre construction of a row of low-rise townhouses in Santa Mesa district, Manila. This media personality recently discovered that the unit above the one she owned could cave in on hers because the incorrect pouring of cement on the structure has allowed rainwater to seep through.
This problem manifested itself to her when her unit was flooded last week, soaking her prized possessions, including lots of books. It is not hard to imagine that the owners of the other units in her building—and that of other buildings on the row—would deal with this problem, too, once they move in.
Clearly, a mechanism that would allow a third party to sort out problems relating to the buildings’ construction and other matters is needed, so that condo-unit buyers can air their grievances and have a solution to their problems.
Bank earnings to rise
BANKS have their own pass-on rates when it comes to the interest rate that the Bangko Sentral ng Pilipinas
(BSP) officially stamps. Now the average lending rates of the banking system have risen from 5.391 percent in June to 5.604 percent in August, which could mean additional millions reflected in the banks’ income statements. When the BSP raised its interest rates to temper inflation, the banks also raised theirs for
bank borrowers.
Somehow, the inflation rate, which robs Juan de la Cruz of his purchasing power, has eased from 4.9 percent in August to 4.4 percent in September, which the Department of Finance (DOF) is happy about, since it could indicate that the BSP would take it easy when raising its policy rates. Why? Because the DOF is relying on the status quo, as far as rates are concerned, so that the Philippines can boast of higher GDP growth.
The rise in prices was key to the BSP’s move to hike the rates that it charges banks and even for the 50-basis-point rise in special deposit accounts, or money that banks are forced to put in the central bank’s vault in order not to chase prices higher. Unless another calamity emerges that disturbs the equilibrium, the DOF sees the higher end of the growth rate to be achieved by year-end. This could mean good news for President Aquino, who has expressed openness to running for a second term.