THE IDEAL LOCATION TO INVEST IN 2018
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