Pace of recovery to hinge on consumer mobility in fourth quarter
A PRESIDENTIAL adviser said the economic recovery will depend largely on whether consumers enjoy a degree of mobility in the fourth quarter, the time of year when businesses generate outsized profits.
Jose Maria A. Concepcion III, Go Negosyo founder and member of the Marcos government’s Private Sector Advisory Council, said the consumer spending surge late in the year is expected to be beneficial to micro-, small-, and medium-sized enterprises (MSMEs).
“We need people going out. If people don’t spend, this will affect our economy. How will we attain the growth target that is needed to maintain our credit rating? The last quarter, beginning this October, is crucial for our MSMEs,” Mr. Concepcion said in a statement on Sunday.
Mr. Concepcion said many of the factors affecting consumer spending, like inflation, are largely beyond the government’s control.
“We cannot control rising prices and rising interest rates. External factors like the conflict in Ukraine are now affecting all of us,” Mr. Concepcion said.
Mr. Concepcion also noted that remittances from overseas Filipino workers (OFWs) will help prop up the recovery following the depreciation of the peso.
“We are facing strong headwinds, but there are things that can help us sail through and come out with a strong economy by the first quarter. Hopefully OFW remittances will continue to buoy the economy, seeing that already the strong dollar is adding 10% to the value of dollar remittances,” Mr. Concepcion said.
“What we can control is our own willingness to keep businesses active. There are actions that can be taken to mitigate the effects of rising prices so that the economy remains active throughout the holiday season,” he added.
According to Mr. Concepcion, Filipinos should continue to be cautious about COVID-19, following the return of students to face-to-face classes and as protocols relax on the wearing of face masks outdoors.
He added that work-from-home (WFH) arrangements should be postponed to next year when possible, after prices stabilize and mobility no longer as critical to economic activity.
“Philippine Offshore Gaming Operators leaving the Philippines will have an effect on our economic activity. If we push for 100% WFH in the information technology and business process outsourcing (IT-BPO) sector, this will greatly affect the economy, especially now that we are seeing more turbulence due to the Russia-Ukraine conflict,” Mr. Concepcion said.
Recently, the Fiscal Incentives Review Board announced that registered IT-BPO firms situated within economic zones may implement 100% WFH arrangement while still enjoying fiscal incentives by transferring their registration from the Philippine Economic Zone Authority to the Board of Investments.
In a statement over the weekend, the Philippine Chamber of Commerce and Industry (PCCI) said it hopes to meet with the government’s economic managers to discuss ways of sustaining economic growth at this stage of the pandemic.
PCCI President George T. Barcelon said the business community is looking forward to talks with government officials during the 48th Philippine Business Conference & Expo (PBC&E) on Oct. 19-20 at the Manila Hotel.
“While we had courtesy visits done earlier, the PBC&E is a much bigger platform where our members and partners could directly engage with government on issues that affect business and learn first-hand from our economic managers on their plans to address them,” Mr. Barcelon said.
Perry A. Ferrer, 48th PBC&E chairman, said the easing of economic restrictions can aid the economic recovery, following the two-year slowdown caused by the pandemic.
“We should take this opportunity to work on certain policies and programs that would renew the trust and confidence of businessmen in doing business and investing in the country,” Mr. Ferrer said.
Some of the confirmed speakers during the 48th PBC&E include Finance Secretary Benjamin E. Diokno, Socioeconomic Planning Secretary Arsenio M. Balisacan, Information and Communications Secretary Ivan John E. Uy, Trade Secretary Alfredo E. Pascual, Tourism Secretary Maria Esperanza Christina G. Frasco, Transportation Secretary Jaime J. Bautista, Environment Secretary Maria Antonia Yulo Loyzaga, and Interior Secretary Benjamin C. Abalos. — Revin Mikhael D. Ochave
