Short-term political risks ‘normal’—UK economist

Published May 12, 2022, 12:52 PM

by Chino S. Leyco

Short-term political risks associated with government transition in the country following the election are normal, according to a UK-based think tank Pantheon Macroeconomics.

Miguel Chanco, Pantheon Macroeconomics chief emerging Asia economist, said uncertainties associated with government transition in the country will likely recede quickly, as the election has produced a clear outcome.

“Indeed, Mr. Marcos’ red carpet to Malacanang Palace is getting more comfortable by the hour, with Comelec [Commission on Elections] yesterday [May 10] affirming their dismissal of the disqualification cases made against his candidacy,” Chanco said a report dated May 11.

Chanco also said that Vice President Maria Leonor “Leni” G. Robredo’s call to her supporters to accept whatever would be the final results of the 2022 presidential race has also signaled “something of a concession”.

“While her campaign has pledged to start a consultation on allegations of electoral misconduct, what she hasn’t said is just as important, as she has yet to say that Mr. Marcos’ likely win is illegitimate,” the economist said.

“The dust from the election should settle fairly quickly, but we reckon that it’ll still take some time before investment gets going again,” he added.

But while uncertainty over the election is all but over, Chanco also equally emphasized that the ambiguity over Marcos’ economic policy positions is still there.

He explained that Marcos had offered primarily vague aspirations on his few interviews during the campaign relating to job creation, supports to small- and medium-sized enterprises, the agricultural sector and tourism.

“We’re unlikely to get any inkling of the potential policy trajectory until the third quarter, at the earliest, when Mr. Marcos’ administration will start to take shape,” Chanco said.

“We maintain, though, that this will be too late to salvage this year’s economic growth prospects, assuming we’re proven right about the temporary—but harsh—brakes likely applied in the current quarter to government spending and investment,” he added.