The local economy grew at its slowest pace in three years last quarter, clocking in at 6.1% year-on-year, slower than the 7.2% growth recorded in the same period last year. According to Socioeconomic Planning Secretary Ernesto M. Pernia, the economy needs to grow by at least seven percent this quarter to hit the floor of this year’s goal.
Meanwhile, inflation hit its fastest pace in more than nine years in October, as prices of widely used goods rose another 6.7%, steady from September and surging from 3.1% a year ago. Market watchers are divided on whether inflation has peaked, though some expect fresh tightening from the central bank to further temper price expectations.
In other news, factory activity in the Philippines saw the biggest improvement in 10 months in October, keeping the country in the lead in Southeast Asia. This, fueled by “a sharp rise in demand for manufactured goods.” Vietnam and Indonesia tailed the Philippines in growth, with the rest of the ASEAN economies bringing down the regional index towards market deterioration.
The government has named its third major telco: Mindanao Islamic Telephone Company, Inc. (Mislatel) — a consortium formed by China Telecommunications Corp., Dennis A. Uy’s Udenna Corp., and its subsidiary Chelsea Logistics Holdings Corp. This came after Mislatel’s two contenders were disqualified over a lack of required documents. A final decision will arrive next week, after the selection committee completes its review of the disqualified companies’ appeals.
Regardless of next week’s result, the third telco will still face an uphill battle towards becoming a true competitor, Fitch Ratings said. They would “initially… compete aggressively on price as it strives to grab market share in an already highly saturated mobile market.” Government intervention may be needed to accelerate industry reforms to raise competition, they added.