Newsweek - - Periscope World -

One of the fastest-grow­ing economies in Asia, there are an in­creas­ing num­ber of at­trac­tive op­por­tu­ni­ties open­ing up in what could cur­rently be the best coun­try in Asia to in­vest in.

“The Philip­pines is a sure bet for in­vestors,” says Ed­win R. Bautista, pres­i­dent and CEO of Unionbank, a ma­jor lo­cal bank. Hav­ing ex­pe­ri­enced re­mark­able growth for over a decade, the trop­i­cal ar­chi­pel­ago in the South China Sea, con­tain­ing nearly

7,500 is­lands and over 100 mil­lion peo­ple, saw a 6.7% year-on-year growth in gross do­mes­tic prod­uct (GDP) in 2017.

That makes the Philip­pines one of the top three per­form­ers in Asia, says the World Bank, which pre­dicts that its econ­omy will con­tinue to ex­pand at about 6.7% a year un­til at least 2020.

The coun­try’s Na­tional Eco­nomic De­vel­op­ment Author­ity ex­pects even more, says Fed­erico A. Laxa, chair­man and CEO of lead­ing prop­erty devel­oper First Shel­ter Ven­tures and Realty Cor­po­ra­tion: “They are look­ing at 7% for the next few years, pos­si­bly un­til 2022.”

Home to a Huge Tal­ent Base

A range of fac­tors is driv­ing this achieve­ment, not least the Filipinos them­selves. Ex­pand­ing at around 2% a year, the world’s 13th-big­gest pop­u­la­tion is “rel­a­tively young and in­creas­ingly mid­dle class. We have the right de­mo­graphic pro­file to sup­port fu­ture eco­nomic growth,” says Ce­sar G. Romero, pres­i­dent and CEO of Pilip­inas Shell Pe­tro­leum Cor­po­ra­tion (PSPC), a sub­sidiary of Royal Dutch Shell.

“Within 30-50 years, over 50% of the pop­u­la­tion will be at a pro­duc­tive age,” adds Jaime E. Ys­mael, pres­i­dent and CEO of an­other im­por­tant devel­oper, Or­ti­gas & Com­pany; “That pro­vides op­por­tu­nity for cre­at­ing jobs, build­ing the mid­dle class and keep­ing the en­gine revved.”

This large and well-ed­u­cated tal­ent base ex­plains Ed­win R. Bautista Pres­i­dent and CEO, Unionbank why, de­spite not hav­ing a huge man­u­fac­tur­ing sec­tor, the Philip­pines is an im­por­tant force in ser­vices. For ex­am­ple, it is the global cap­i­tal for busi­ness process out­sourc­ing (BPO), with about 1,000 com­pa­nies in the coun­try gen­er­at­ing $13 bil­lion in 2017 by han­dling 16-20% of the world’s BPO busi­ness, ac­cord­ing to Texan con­sul­tants The Ever­est Group.

Hav­ing a highly skilled, English-speak­ing pop­u­la­tion has other pos­i­tive im­pacts. Many move abroad and send earn­ings back home, for ex­am­ple, there are over 3.5 mil­lion Filipinos in the U.S. and in the first half of 2017, re­mit­tances from over­seas cit­i­zens were $5.4 bil­lion.

As well as im­port­ing dol­lars, these ex­pats in­tro­duce those at home to the lat­est tech­nolo­gies from their adopted coun­tries, giv­ing a fur­ther boost to knowl­edge in the con­sumer-led, high­spend­ing Philip­pines.

In­creas­ingly, the pri­vate-sec­tor is in­vest­ing in new ac­tiv­i­ties, such as man­u­fac­tur­ing in ex­port pro­cess­ing zones. As in all sec­tors, in­vestors are en­cour­aged by a sta­ble macro en­vi­ron­ment, pru­dent debt man­age­ment and at­trac­tive tax in­cen­tives.

Ris­ing For­eign In­vest­ment

When the com­pet­i­tive costs of run­ning a busi­ness in the Philip­pines are also con­sid­ered, it is no sur­prise that much of the in­vest­ment is in­ter­na­tional. In 2017, to­tal for­eign di­rect in­vest­ment

“We have the right de­mo­graphic pro­file to sup­port fu­ture eco­nomic growth.” CE­SAR G. ROMERO, PRES­I­DENT AND CEO, PILIP­INAS SHELL PE­TRO­LEUM COR­PO­RA­TION

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