Finance Secretary Carlos G. Dominguez III said the robust growth of the Philippines’ now fully reopened economy, buttressed by reforms that “widen the horizon for investments,” makes it the best place in the region to do business.
With Japan-based debt watcher Rating and Investment Information Inc (R&I) maintaining the Philippines’ “BBB+” credit rating with a stable outlook only a little over week ago, Dominguez called on Japanese investors to further invest and expand their businesses in the country as it returns to normalcy after its Covid-19 cases have continued to subside rapidly.
Dominguez pointed out that in the last quarter of 2021, the Philippines’ gross domestic product (GDP) grew by 7.8 percent, making the country’s expansion one of the highest in the ASEAN region and among its credit rating peers globally.
This better-than-expected GDP expansion brought the Philippines’ 2021 full-year GDP growth to 5.7 percent, exceeding the government’s target and making one of the best economic performances among its regional neighbors and credit rating peers, Dominguez said.
“This year, we are well on our way to returning to normalcy with the Philippine economy expected to expand further between 7 and 9 percent,” Dominguez told Japanese business leaders and policymakers in Tokyo, Japan.
Dominguez’s optimism on the Philippines’ prospects is shared by R&I, which has said that while the world continues to face the challenges of the pandemic, “The Philippine economy has been demonstrating solid growth since the second quarter of 2021” and that “the government debt ratio is expected to stabilize in the near term, supporting the country’s economic recovery.”
The investor briefing was organized by Sumitomo Mitsui Banking Corp. with the support of the Philippine Embassy in Japan to provide Japanese investors a comprehensive update on the performance of the Philippine economy and the game-changing reforms that have been carried out to restore the country to its pre-pandemic path of sustained high and inclusive growth.
It was the first face-to-face event of the Department of Finance (DOF) with investors since the pandemic began in 2020.
The briefing was conducted to facilitate a more productive discussion compared with the usual online conferences, Dominguez said.
While the government is bullish on the Philippines’ economic prospects, Dominguez said this has been tempered by the uncertainties introduced by the Russia-Ukraine conflict.
He said the Duterte administration is closely monitoring this geopolitical crisis and has been doing its utmost to mitigate the impact of oil and food price increases on the Filipino people.
Dominguez thanked Japanese investors for their support of the Philippines’ Samurai bond issuances, which have consistently generated strong demand.
He recalled that last year, the Philippines’ offering of its first-ever zero-coupon Samurai bond was almost double the initial target size of 30 billion yen (JPY) to JPY55 billion, despite the pandemic.
The Philippines’ recent issuance of its first-ever ASEAN Sustainability bond transaction in the Samurai bond market yielded new investor accounts and demand of more than JPY70 billion in the midst of a volatile market environment, Dominguez noted.
Dominguez also thanked Japan for being “an extremely reliable partner of the Philippines.”
He pointed out that Japan remains to be the Philippines’ biggest provider of official development assistance (ODA), aggressively supporting President Duterte’s signature infrastructure modernization program “Build, Build, Build,” the development of Mindanao, and other areas of sectoral cooperation between the two countries.
Japan has also long been one of the Philippines’ top investment partners, the country’s top export market and second-biggest import supplier.