Photo collage by THEPHILBIZNEWS/MAS

By Monsi A. Serrano

After getting a heavy beating in 2020 from the coronavirus pandemic that created economic havoc, many have expressed optimism on what lies ahead in 2021 given the fact that that many are back in the business and also the availability of the vaccine added to this good forecast.

With all these indications and bullish forecast from various business sectors and foreign investors, Trade Secretary Ramon Lopez expressed confidence in a more optimistic business outlook for 2021.

This is also a result of the latest Social Weather Stations (SWS) report of the November 2020 Net Economic Optimism, released on January 5. The report, conducted from November 21 to 25, indicated that 42% of Filipinos expect the local economy in better shape in the next 12 months. 

“The Duterte administration remains committed in its thrust to assist local businesses build back better. This report shows that despite the setbacks that our enterprises faced during the height of the pandemic, Filipino resiliency and innovativeness will always prevail,” Sec. Lopez said.  

According to the survey, only 18% of Filipinos expects the economy to worsen this year while 28% said it would stay the same. This resulted in the net economic optimism score of +24, which is classified as “high”. The SWS described the November 2020 report as a “recovery” from the mediocre scores of -9 in July and -5 in September of last year. 

“DTI will continue to implement various programs under the REBUILD PH campaign, or ‘Revitalizing Businesses, Investments, Livelihoods, and Domestic Demand,’ as we have continuously done when we slowly eased into reopening the economy,” the Trade Chief added. 

“With 99.5% of our businesses being micro, small, and medium enterprises (MSMEs), DTI shall further strengthen its programs to support MSMEs, such as in training, mentorships, microfinancing and equipment support and market development for enterprises to become COVID-proof. This will save companies that will save jobs. These jobs, in turn, will sustain the incomes that will create demand, which would help to revive the economy,” the Secretary Lopez explained. 

Sec. Lopez further expressed optimism with the government’s forecast that the Philippines will have a 6.5% GDP recovery for 2021. Likewise, he highlighted the signs of economic recovery, which started to be apparent during the latter half of 2020. These range from the continued improvements in GDP growth from -16.5% in Q2 to -11.5% in Q3, and lowered unemployment rate of 8.7% in October from a record-low 17.7% in April.  

He also noted the Purchasing Managers’ Index (PMI), which reached 50.1 in September, indicating stable conditions in the manufacturing sector, and only slightly dropped to 49.2 in December. There was also the positive growth in exports reaching 2.9% in September but facing -2.2% in October, which the Trade Secretary described as a “minor bump on the road to recovery.”   

Additionally, Sec. Lopez said that he looked forward to the passage of the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE), calling it a “game-changer” aimed at lowering corporate income tax down to 20% (from the current 30%) for MSMEs or domestic corporations with total assets, excluding land, of not more than PHP 100 million and net taxable income of PHP 5 million and below. The bill is currently at the bicameral conference committee in Congress and is expected to be passed for President Rodrigo Duterte’s signature soon. 

“As we promote our country in the face of the expected global recovery, we can tap the emerging opportunities and challenges from shifting trade and investment preferences and changing forms of international production,” the trade chief said. 

He added, “This will be made possible as we continue to fast-track our industrial strategies with re-skilling and upskilling of our workforce along with adapting new technologies. With the aggressive Build Build Build infrastructure development program of the Duterte administration, economic infrastructure will further drive down cost and improve efficiencies in business operations. With a more resilient, inclusive and sustainable effort, we are gearing up for a dramatic recovery for the year ahead.” 

Sec. Lopez assured that for this year, the Department has laid down targeted programs and projects on investment and exports promotion as well as enhanced livelihood support programs in order to achieve a V-shaped economic recovery, as well as ensuring that not only businesses are supported to bring back more jobs but also the consumer welfare is prioritized.

With a foreseen strong economic rebound after the opening of businesses and the safe return of workers, the Philippines is set to become one of the resilient countries in Asia.

Last October 28, the “Make it Happen in the Philippines”, the new international investments promotion campaign of the Philippines, had a soft-launch in the Australia-New Zealand (ANZ) highlighting the lucrative business and investment opportunities in the country and its resilience as the country continues to bounce back from the global pandemic.

Philippine Trade Minister and Board of Investments (BOI) Chairman Ramon Lopez led the virtual soft launch along with Philippine Ambassador to Australia Ma. Hellen B. De La Vega and Philippine Ambassador to New Zealand Jesus S. Domingo. Australian firms operating in the Philippines Acquire BPO and TMA Group of Companies Ltd. as represented by their Chief Executive Officers meanwhile gave testimonials on how they made it happen in the Philippines.

“Despite the setbacks and challenges brought about by the pandemic, the Philippines still remains a conducive place to do business. We are considered one of the top emerging economies and countries for investments,” said Minister Lopez.

The Economist magazine ranked the country as the 6th emerging economy with high financial strength. CEOWorld Magazine meanwhile placed the Philippines among the top 10 countries to invest in post-COVID era. The World Bank and International Monetary Fund have already predicted a V-shaped economic recovery for the country, with forecasts of 6.2 percent to 6.8 percent respectively by 2021.

In his key message, Secretary Lopez presented the country’s new industrial strategy and international marketing campaign that is expected to boost the expected turnaround of the economy from the effects of the pandemic.

“The way forward for us is to build back better and to stay the course to have a better future for our country. Our goal is to have a modern, dynamic, and the responsible Philippines. This is what our new industrial strategy is all about: the REBUILD PH or ‘Revitalizing Businesses, Investments, Livelihoods, and Domestic Demand’. This strategy aims to jumpstart and reinvigorate the economy by revitalizing consumption and enhancing production capacity,” he said.

He also highlighted some of the sectoral opportunities in the country’s priority investment areas such as electronics, aerospace, automotive, IT-BPM, and copper.

“We are confident that our new ‘Make it Happen in the Philippines’ campaign will promote our country’s ‘roll-up-your-sleeves’ and ‘make-it-work’ mindset. This attitude is what makes the Philippines a unique and attractive investment landscape for strategic sectors in the ASEAN region for foreign investors. Even as we push the Philippines’ recovery against COVID-19, we are committed to continuing our country’s economic growth story. That is why we call on our Australian and New Zealand friends to take a closer look at how you can partner with the Philippines. You will see how we can ably support your business expansions plans, and provide you with a deeper insight on how to ‘Make it Happen in the Philippines’,” he concluded.

Meanwhile, Ambassador De La Vega said that the manufacturing strategy of Australia aligns with the Philippine key industries such as auto, aerospace, electronics, IT-BPO, and copper/nickel. She also mentioned that the IT-BPM and creatives sectors continue to be a bright spot. “Digital is the way to go and a globalized workforce is crucial. We invite our Australian friends to make it happen in the Philippines and make it happen now,” she said.

“Among Kiwi investors, I see further investments in IT, BPOs, food, and agribusiness. This can run parallel to our efforts to maintain and further professionalize our human resources and trade services with New Zealand. Let us leverage NZ’s hosting of APEC next year which will be largely online. We pledge our support to this dynamic new initiative to track Kiwi, Aussie, pacific and global investments in our country,” Ambassador Domingo added.

Acquire BPO CEO Scott Stavretis said his company has around 7,000 employees in the Philippines spread across 10 locations and caters to 100 plus global clients. Their services include customer service, sales, technical support, retention campaigns, back-office functions, software development, and marketing services for private and publicly-listed companies around the world.

TMA Group CEO Anthony Karam narrated how his firm won in 2009 a 25-year Joint Venture (JV) pact with the Philippine Charity Sweepstakes Office to establish the first Thermal Coating Plant in the Philippines. To date, TMA has invested Php4.4 billion in its facility in Laguna and upon full maturity of its operations, it will employ around 1,500 personnel. Both companies attested to the skillsets and resiliency of their Filipino employees as crucial in their expansion and success by sustaining operations amid the pandemic as they easily adapt to the new normal.

The ‘Make It Happen in the Philippines’ campaign is the unified country branding campaign of the Philippines’ investment promotion agencies in promoting the country as an investment destination. “This is the first time that the Philippines have a sustained multisector, multimarket campaign primarily designed to generate investments,” said Minister Lopez.

The Philippine BOI, the government’s lead industry and investment promotion agency developed the new international investment promotion campaign in partnership with the United Kingdom Government under the Investments Promotion Program.

The campaign’s virtual soft launch in Australia and New Zealand was jointly organized by the Philippine BOI and the Philippine Trade and Investment Center Sydney, the DTI’s overseas office in ANZ.

Read related stories:

https://thephilbiznews.com/strong-economic-recovery-seen-as-ph-continues-reopen-businesses/

https://thephilbiznews.com/ph-post-covid-economy-sets-to-rebound-in-2021/