No change in sta­bil­ity

Business Mirror - - FRONT PAGE - Manny B. Vil­lar

SOME in­ter­est­ing state­ments made by Demo­cratic Party pres­i­den­tial can­di­date Bernie San­ders last week quickly be­came a sen­sa­tional topic in the US press.

He was quoted by CNN, cit­ing an As­so­ci­ated Press re­port, as say­ing that he is seek­ing the nom­i­na­tion be­cause “democ­racy is messy. But if you want ev­ery­thing to be quiet and or­derly and al­low, you know, things to pro­ceed with­out vig­or­ous de­bate, that is not what democ­racy is about.”

With the Novem­ber elec­tions in the United States com­ing closer, the Demo­cratic Party still has to choose, through pri­maries, who to field between San­ders and Hil­lary Clin­ton against Don­ald Trump, who has al­ready gained the re­quired num­ber of del­e­gates to be­come of­fi­cial pres­i­den­tial can­di­date of the Repub­li­can Party.

San­ders’s con­tro­ver­sial state­ments showed how bit­ter and heated cam­paign in the US, and re­minded me of the sim­i­lar na­ture of the pres­i­den­tial cam­paign in the Philip­pines.

Nu­mer­ous ac­cu­sa­tions were, and are still, be­ing thrown against aspir­ing pres­i­den­tial can­di­dates in the US, in­clud­ing the cit­i­zen­ship of one as­pi­rant, the tax pay­ments of an­other, as well as con­tro­ver­sial pro­pos­als to solve ter­ror­ism, im­mi­gra­tion and other prob­lems of the US.

The Philip­pines, which adopted the Amer­i­can form of demo­cratic gov­ern­ment, has just elected a new pres­i­dent, but dur­ing the cam­paign pe­riod, we also saw a bit­ter ex­change of ac­cu­sa­tions, as ev­ery can­di­date tried to woo Filipino vot­ers.

For­tu­nately, the bit­ter cam­paign did not trans­late into vi­o­lence and, ac­cord­ing to the Commission on Elec­tions, the 2016 elec­tions were gen­er­ally peace­ful and or­derly.

The bet­ter-than- ex­pected per­for­mance of the econ­omy, which grew by 6.9 per­cent in terms of GDP in the first quar­ter, was not re­ally sur­pris­ing, given the heavy spend­ing by can­di­dates and po­lit­i­cal par­ties.

It’s good news, but from a busi­ness per­spec­tive, I be­lieve it is im­por­tant to note that sta­bil­ity re­mains, de­spite the wari­ness—even skep­ti­cism— that some busi­ness­men felt dur­ing the cam­paign, par­tic­u­larly when it be­came clear that Davao City Mayor

The Philip­pines, which adopted the Amer­i­can form of demo­cratic gov­ern­ment, has just elected a new pres­i­dent, but dur­ing the cam­paign, we also saw a bit­ter ex­change of ac­cu­sa­tions, as ev­ery can­di­date tried to woo Filipino vot­ers. For­tu­nately, the bit­ter cam­paign did not trans­late into vi­o­lence and, ac­cord­ing to the Commission on Elec­tions, the 2016 elec­tions were gen­er­ally peace­ful and or­derly.

Ro­drigo R. Duterte would win the pres­i­dency.

We still have to see whether the econ­omy will be able to sus­tain its per­for­mance up to the fourth quar­ter, but our ad­van­tage is that our strong fun­da­men­tals are in­tact.

I al­ready men­tioned that Duterte’s vic­tory would at­tract more in­vest­ments in Min­danao to un­lock its huge po­ten­tial to con­trib­ute more to the na­tional econ­omy. In­ter­est rates re­main low.

Dur­ing its meet­ing on May 12, the Mon­e­tary Board (MB) de­cided to main­tain the key pol­icy rates of the Bangko Sen­tral ng Pilip­inas (BSP) at 4 per­cent for overnight bor­row­ing and 6 per­cent for overnight lend­ing. The board’s de­ci­sion was based on its as­sess­ment of a con­tin­u­ing man­age­able in­fla­tion en­vi­ron­ment.

The MB said that, while the global econ­omy was weak­en­ing, the prospects for the do­mes­tic econ­omy re­main ro­bust. Cash re­mit­tances from over­seas Filipinos amounted to $2.4 bil­lion in March, up 1.5 per­cent from the same month last year. For the first quar­ter of 2016, the BSP said cash re­mit­tances reached $6.6 bil­lion, higher by 4.4 per­cent com­pared to the same pe­riod in 2015.

Also, ac­cord­ing to the BSP, for­eign di­rect in­vest­ments ( FDI), which are in­vested in long-term projects like in­dus­tries, in­creased by 50.6 per­cent to $936 mil­lion in the first two months of 2016 com­pared to $622 mil­lion in Jan­uary to Fe­bru­ary last year.

In an­other re­port, the BSP said the Philip­pine fi­nan­cial sys­tem re­mained sound and sta­ble in 2015, de­spite the chal­lenges in the global fi­nan­cial land­scape, in­clud­ing the volatil­i­ties in China. Thus, lo­cal banks are ex­pected to con­tinue pro­vid­ing the needed fund­ing to the grow­ing econ­omy.

For com­ments, e-mail mbv.sec­re­tariat@gmail.com or visit www.man­nyvil­lar.com.ph.

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