39th pbc cielito habito
TRANSCRIPT
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Cielito F. HabitoUSAID TRADE Project
Investment-Grade Philippines:Breaking Out
PHILIPPINE BUSINESS CONFERENCEManila Hotel
OCTOBER 22, 2013
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Investment Growth, 2004-2009Gross Domestic Capital FormationAverage Annual Growth Rate (%)
2010-13> 10.6
S1-2013>12.7
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How Is The Economy Doing?The PiTiK Test
The Essential Yardsticks (P-T-K):
Price Stability(Presyo)
Jobs (Trabaho)
Incomes (Kita)
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The Economy In Q2-2013Good News: 2 out of 3
Prices:Slowed down to 2.8% in 2013 vs.3.2% in 2012; Aug 2.1% (Food: 1.8%)
Jobs:July 2013 unemployment rose to 7.3%from last years 7.0%; 620,000 additionaljobs, but 155,000 additional unemployed;underemployment persistently high at 19.2%
Incomes/Output: GDP grew 7.5%, upfrom previous years 6.5% growth
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Then and Now
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Signs of a Take-Off
PiTiK Test: Then and Now
Source: NSCB
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Taking Off Where It Matters
Source: NSCB
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Growth Drivers in 2013 andBeyond
Election Spending: A consistent stimulus
Government spending: Full throttle; PPPs
finally coming on stream; stronger revenues
Governance: Improvements are taking hold
Private domestic investment: Up from a
decade of stagnation; FDI picking up
Fitch, S&P & Moodys: Investment GradeRating
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Remittances: Steady growth
Gaming Investments: Philippines as the new
Macau? Tourism: More fun in the Philippines
Mindanao: Peace agreement will unleash
new growth potentials New manufacturing investments
China: No longer factory of the world
Growth Drivers in 2013 andBeyond
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Reality Check:Much work remains
Source: ADB
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Our trade with ASEAN is largely intra-
industry in nature (we trade in products
belonging to the same industries)
Electronics: We export intermediatecomponents but import finished products
We sell Thailand motor vehicle parts; they sell usmotor vehicles
Our trade relationships in Asean are largely
complementary rather than competitive;
opportunities lie in regional (and global)
value chains
Whos Afraid of the ASEAN
Economic Community
2015?
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ASEAN Economic CommunityObservations
Aggregate regional impacts will be positive
Some economies/sectors will gain more
than others (a few may be hurt) AEC is forcing us to do the right things!
There will be winners and losers within
economiesMust be clearly identified
Find creative ways for winners to
compensate the losers
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Ruchir Sharma: Breakout Nations
PH: New economy to
watch!
Move over, BRICS; TIP(Turkey, Indonesia &
Philippines) is here
Sharma: Quality ofpolitical leadership
crucial to becoming a
breakout nation