Filipino businesses are wary of achieving sustained growth this year as the continued rise in prices of goods are expected to fuel clamor for wage hikes and eventually dampen the domestic economy.

George T. Barcelon, president of the Philippine Chamber of Commerce and Industry (PCCI), expects the domestic economy to sustain a healthy pace the first half of the new year.

“Despite interest hike to mirror the US and European's action and mitigate inflation, our dollar remittance and local rebounding economy can weather it,” he said.

One issue of concern though is the seemingly no solution in sight on high food prices which will “heighten the clamor for big wage adjustment.”

He said the wage adjustment is a concern because “This will have a vicious cycle on inflation and impact our competitiveness in export sector. As such, the outlook on both job creation and sustainability during the second half business may encounter headwind.”

While Sergio Ortiz-Luis Jr., president of the Philippine Exporters Confederation (PhilExport) agreed with Barcelon he said “We will remain optimistic despite the headwinds.”

At the export sector, he pointed out the strengthening performance as government policies and private sector programs are in place and designed to meet global and domestic disruptions.

But again, he said, the very critical concern is how government will address regulatory burdens on the private sector, the latest of which is the impending Philippine Ports Authority (PPA) implementation of container monitoring.

According to Ortiz-Luis, the PPA system is “redundant, very expensive and tedious for private sector. I hope that PPA and other concerned agencies still operating in silos will put their acts together if we are to remain upbeat and in the radar of global trade and business.”

Francis Chua, founding chairman of the International Chamber of Commerce, Philippines (ICCP), expressed confidence that the domestic economy can weather the difficulties.

Chua noted that the full reopening of all sectors, including tourism, since last year will cushion the impact of global recession. Besides, he said, “President Ferdinand Marcos Jr. is running the government smoothly.”

The President’s various foreign trips could also help entice foreign investors to locate into the country and for traders to do more business here.

With that Chua urged for the immediate concurrence by the Senate of the Malacanang ratification of the Regional Comprehensive Economic Partnership (RCEP). “Senate should concur as soon as possible the RCEP to widen our exports market, especially during this difficult time,” he said.

Edgar G. Lacson, president of the Employers Confederation of the Philippines (ECOP), said they shared with the optimism of Finance Secretary Ben Diokno, the country’s head of the economic cluster when he said, “the worst is over, and the best is yet to come.”

Nonetheless, Lacson urged labor leaders to temper their demand for ‘unaffordable’ minimum wage increase at this time because the most affected by this added cost of doing business will be the micro small and medium enterprises (MSMEs), which constitute 99.6 percent of registered enterprises.

Lacson explained that a big number of MSMEs were permanently shuttered by the Covid 19 pandemic and the ensuing harsh lockdown. “Those who survived are still in intensive care struggling to restart and regain lost opportunities from the two-year economic disaster,” he said.

“Wage increases if allowed by regulators to pass in 2023 will be self-destructive and set back our march towards recovery. But these headwinds properly handled will help to slingshot business towards national prosperity,” Lacson concluded.