Despite being less than a month into the new year, my optimism for the Philippines is steadily growing.
The “Presidential Helicopter Ride” may go down in future books on politics as one of the worst optics ever and a textbook case of how not to handle damage control. Nonetheless, let’s hope that is as bad as the political scene gets.
However, the ICC v. Duterte is definitely a great concern. Whatever happens over the next months will check the “Filipino Resiliency” that we hear so much about. Again, we can only hope that sober minds prevail no matter the outcome. This situation will serve as a critical examination for all political leaders in the Philippines, whether currently in office or not.
The current headlines though are about Metro Manila having the worst traffic on the planet. Who was surprised by that? Of course, blame the government? Then again, we also “win” for Metro Manila having five of the top 10 most densely populated cities on earth including Manila/42,942 Per Square Kilometer, Mandaluyong/38,705, Pateros/32,614, Caloocan/32,614, and Makati/28,619.
Perhaps what is needed is a “Go Back to Your Province and Stay There” law. It will definitely work to reduce traffic as we see that happen every year during the “Undas” celebration pilgrimage.
Speaking of laws, it is “Cha-Cha” time again. There is nothing sacred about a nation’s primary legal document. The Constitution of the Kingdom of the Netherlands dates back to around 1814 or 1815 and has been amended a few times. The current version of the Dutch Constitution dates to 1983. But perhaps the Philippines can learn from other countries.
Article 69 of the Belgian Constitution sets forth qualifications for senators: Each senator must be at least 18 years old. The Philippines could potentially have a Senate with a lolo, tatay, and anak all from the same family. Changing the Indian constitution requires only one member of parliament to propose a bill to amend and a simple majority vote of the parliament is all that is required. The Philippine Congress could change the constitution two or three times a year if they wanted to.
I am betting “Cha-Cha” will wind up dead in a ditch by the side of the road. The issue is too emotional, too political, and too complicated.
Economy wise, next Wednesday the results for Q4 2023 and for Full Year GDP Growth will be released. Economic forecasts are difficult and are tainted too often by political prejudice. In November on ANC’s “Market Edge” I made what is probably the worst “recommendation” I have ever made calling for a Buy on Fruitas (FRUIT) when the price was about P1.20. The trend and volume were favorable, but the price fell 30 percent. However, stock trading is a process not “pick a number” economic forecasting.
One source for economic forecasting that I see as unbiased is from AMRO—the ASEAN+3 Macroeconomic Research Office. This group predicts that the Philippine economy grew by 5.6 percent during 2023. We will see how accurate that forecast is on January 31. For 2024, GDP growth is forecast—at this time—to be 6.3 percent. If we can come in above 5.2 percent for 2023, that will be a strong positive.
The following Tuesday will be inflation data—year on year and monthly—and a great concern for all consumers. The Y-o-Y inflation rate in December was 3.9 percent. AMRO is expecting that will fall to 3.6 percent for January. If these forecasts are close to accurate, 2024 will be a better economic year than most expect.
The Philippine Stock Exchange index is basically flat for the year. That is obviously better than “flatlined.” However, I see two scenarios. The low volume is “the calm before the storm” and we need to be ready. Or, “behind every dark cloud there is an ever-shining sun. Just wait. In time, the cloud will pass.” I see the clouds passing sooner rather than later.
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