Philippines: The Next Investment Hotspot
Amid growing
investor confidence spurred by government and private spending, the narrowing
trade deficit, and sound economic policy and fiscal management, investment
analysts from Philam Life state that the Philippine Stock Exchange index (PSEi)
has enough momentum to hit 6,000 points by next year.
In a recent press briefing at The Peninsula Manila, Junie
Banaag, First Vice President & Equity Fund Manager of Philam Life, said that
the PSEi has advanced better than other stock markets over the past two
years.
“The PSEi’s 32% growth from 2010-2012 outpaces that of the
S&P 500, the Indonesian and Malaysian Stock Exchanges, Germany’s DAX, and
even the Dow Jones Industrial Average,” said Banaag. “Strong economic
fundamentals and the Philippine government’s effective management of fiscal and
monetary positions will fuel the growth of the Philippine market.”
Banaag also points out that the Philippines has “one of the
fastest growing economies” in the region and the world as of late. He points to
the 5.9% GDP performance of the country in Q2, which he says makes the
Philippines the fourth fastest growing economy in Asia, trailing behind China,
Sri Lanka, and Indonesia. Moreover, Banaag feels positive about the recent
credit rating upgrades for the Philippines, and is excited about the country’s
prospects of making investment grade in the near future, which he says will
surely bring in fresh funds and more investors into the country.
Sleeping Money
However, Ayen Guevara, Senior Vice
President & Chief Investments Officer of Philam Life, notes that majority of
Filipinos are failing to take personal advantage of the country’s economic boom,
largely due to the lack of knowledge and financial literacy.
Guevara referred to recent data from
the Bangko Sentral ng Pilipinas (BSP) which shows that P4.1 trillion are
“sleeping” in the banks in the form of savings accounts and time deposits, which
earns only 0.375% and 2.75% per annum, respectively. Both have
investment returns that are way below the inflation rate, which currently stands
at 3.6%.
Matching Financial Goals with Investments
“We need to ensure correct asset-liability matching,” said
Guevara. “Savings accounts and time deposits have their place in a proper
portfolio --- short-term savings for short-term needs. However, as seen by the
trillions of pesos in the banking system, most Filipinos place their money in
short-term instruments even for their long-term financial needs, mainly due to
lack of knowledge.”
“The ordinary Filipino should be able to personally capitalize
on where our economy is right now and its growth prospects for the next several
years,” said Guevara. “Imagine if their hard-earned money were placed in the
PSEi which grew 32% in the past two years, instead of an ordinary time deposit
that earns 2.75% per year, less withholding tax of 20% --- more Filipinos would
be growing their personal portfolios.”
Riding on the Growth of the Philippine
Economy
“We want ordinary Filipinos to gain from the economic uptrend
of the Philippines,” said Anthony Bernabe, Vice President for Marketing. “With
Philam Life's Money Tree, Filipinos are given the opportunity to invest
in high-performing funds that take advantage of the Philippines’ booming
economy.”
Philam Life’s Money Tree is a one-time
payment, life insurance-and-investment plan whose various funds have yielded
returns of as much as 8% to 15% per annum. The funds are managed by
investment professionals who use their experience and expertise to help grow
your money in the long-term. Moreover, whether you’re a conservative investor or
have a strong appetite for risk,
Money Tree can adjust to your risk-profile as
it gives you the following funds to choose from: the less-volatile fixed-income
fund, the high-risk, high-reward equity fund, or a mix of both. Last but not
least, Money Tree comes with guaranteed life insurance coverage of at least 125%
of your initial payment, regardless of market conditions.
“We have empowered Filipinos the past 65 years, and Philam
Life has been at the forefront of nation-building all these years,” concludes
Bernabe. “The Philippines is at a unique and enviable position right now, and
our growth prospects over the next several years are quite positive. Philam Life
wants to empower more Filipinos to greater financial prosperity and security
through Money Tree, helping them take advantage of the country’s
economic boom.”
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