...the resilient economy

PH resilient amid world eco woes

by Ira Pedrasa

abs-cbnNEWS.com

08/08/2011

 

MANILA, Philippines - Buoyed by its economic fundamentals, the Philippines will remain resilient as the world economy tumbles due to news of credits risks and debt defaults in some developed economies.

 

In an interview with ANC, Finance Secretary Cesar Purisima said “as shown during the [last] global economic crisis, our remittances remain resilient. The predictions it would go down [did not happen]. Our business process outsourcing industry is still there.”

Markets across the world have continued to shed points after last week’s historic downgrade of the US credit rating from AAA to AA+.

Purisima said the country is only one of a few that have withstood economic crunches, having even posted gains in the last 52 months. “From the reserve standpoint, we have $71 billion.”

The US is the country’s biggest export market and hosts many overseas Filipino workers.

He said the Bangko Sentral ng Pilipinas (BSP) has long been preparing for eventualities, starting with diversifying its reserves. The central bank has been moving into the more stable gold assets.

“On the part of the government, we shall continue to improve the fiscal situation, make our economy more competitive and work on our infrastructure policies,” he said.

This way, the country’s assets will be ready for the taking once investors regain their confidence, he said.

Economist Luz Lorenzo did not agree, however, saying the Philippines stands to lose from the US credit downgrade.

If the US economy is down, millions of overseas Filipino workers working there will also feel the brunt, she stressed.

She also projects a further depreciation of the US dollar against the peso. She sees a weaker dollar against the peso until 2014.

A spending cut could also mean limited jobs for foreigners in the US, or worse, pay cuts or retrenchments. – with a report from Alvin Elchico, ABS-CBN News