Go Negosyo Founder Jose Ma. “Joey” Concepcion III said tough time for local businesses, especially the micro, small and medium enterprises (MSMEs), could last until the second quarter next year as the US Fed is expected to bring down interest rate by then.

“We have to ride it and I think hopefully by next year, there will be greater clarity on the conflict in Ukraine and Russia and hopefully America starts to trim down the interest rates by the second quarter of next year,” said Concepcion during a television interview.

He said that businesses are paying eight to 10 percent in interest rate while MSMEs are hurting more as they are paying higher because their loans are smaller as they have “no other choice.”

“We just have to ride this through, this turbulence, and hopefully by the second part of next year, things will be much better,” he added.

Actually, he said, the “government cannot really do much” either because it is the Russia-Ukraine crisis that is causing the rising interest rate. “This will be the strongest headwinds that our country will face. And we just have to be prepared to withstand it,” he said citing high cost for energy and electricity cost and raw materials.

Concepcion explained that the US Fed is racing aggressively interest rates and the Philippines’ central bank just have to follow otherwise the peso depreciates further.

“Hopefully it's not pushed too much, because then you can have some kind of a recession coming from America and spilling over here. But we have to bear with this headwind, it's quite tough, especially its Christmas time,” he added.

Concepcion he already warned President Ferdinand Marcos Jr. of these headwinds after his election.

Thus, he said, it is imperative that the government will have to continue pushing for economic growth in the last quarter this year. He raised the likelihood of credit rating downgrade if there is no economic growth because of the country’s huge debt.

Fortunately, he said, the Marcos administration has relaxed health protocols and should continue to open the economy, especially tourism.

“That is why continued opening of businesses especially in the last quarter of this year is crucial to many of local MSMEs because this is when most businesses really do recover a lot. Consumer spending is high in the last three months of the year because of the holiday season. We should sustain that so that they can cross over to next year,” he urged.