Business expects slower 2023 GDP growth

Filipino businessmen expect a slowdown in the local economy this year following global economic slump, but expressed confidence that the Philippine growth would still be among the highest in Asia.

Dr. Cecilio K. Pedro, president of the Federation of Filipino Chinese Chambers of Commerce and Industry Inc. (FFCCCII), and Sergio Ortiz-Luis Jr., president of the Philippine Exporters Confederation of the Philippines (Philexport), both agreed that growth in the local economy is slowing down this year during the “Pandesal Forum” at the Kamuning Café on Friday, Sept. 1.

However, both business leaders also agreed that the Philippine growth would still be among the fastest in the region, including China.  

Ortiz-Luis projected the country’s gross domestic product (GDP), the sum total of an economy’s monetary or market value of all the finished goods and services produced within a specific time period, to settle between 4.5 percent to five percent growth only, lower than the government’s six to seven percent target.

“But, do not get us wrong, we’re still ahead with our neighbors in Asia and this is an accomplishment of the government despite all problems,” he hastened to add as he expressed hope for government to  take advantage of the some “hanging fruits and pick them quickly.”

For his part, Pedro said the country’s economic performance is highly dependent on international developments, such as the war in Ukraine, the slowdown in China and the west, among many factors to  consider. 

Pedro did not give his growth projection but said the Philippine growth will be one of the highest in Asia, even higher than China.  “Definitely we are facing a slowdown, but this is not just in Philippines,” he said.

The FFCCCII, however, as a group believes that the Philippines can still achieve a six to seven percent growth for 2023 with the expected increase in economic activities due to the Christmas season especially with the start of the exciting “ber” months starting this month, September.

The association also expects more economic activities with the  revival of tourism industry, increased election-related spending with the upcoming barangay and SK Sangguniang Kabataan elections on Oct. 30.

Fortunately, he said, because of overseas Filipino workers (OFWs) there will still be higher consumer spending. “We have many heroes, our OFWs,” he said. 

He said there are lots of things to sustain growth like improving tax collection and generating more investments to create more income for the country and Filipinos, increase employment and in the process be able to compete with the rest of Asia.

“There seems to be a slowdown due to high prices of commodity and slower global economic growth.  We must be cautious and address the inflation problem, which lessens the purchasing power of our people,” he said.

Pedro also called on government to work on attracting more foreign direct investment (FDI). He said the Philippines’ participation in the Regional Comprehensive Economic Partnership (RCEP), the world’s largest free trade agreement, would help attract more FDI to the Philippines as a production base noting the country’s strategic location in the region.

To attract FDIs, he stressed on the need to further ease doing business by reducing circuitous permitting processes and eliminate government red tape through digitalization. 

With the country’s power rate being one of the highest in the region at P13 to P14 per kilowatthour, Pedro urged the government to look at the nuclear power technology, which is the cheapest technology. He said that safety measures are already available for the nuclear power technology.

“We have to make decision as soon as possible because without power, there will be no investments coming into the country,” he said.

The FFCCCII leader also said that another source of their cautious optimism stance is the government’s infrastructure investment - the “Build Better More” program, which they said will have a strong impact on the country’s economy.

He also noted that manufacturing and agriculture sectors are vital sectors in the economy as major sources of employment and contributors to productivity.

“We hope for more support for the manufacturing industry and agriculture are bright spots in the economy to counter any adverse effects of a global slowdown. We need government support to embark on modernization of systems to better support the growth of these industries,” he said.  

The FFCCCII also expressed support for efforts to fight smuggling, which they said is a threat to domestic industries, and also threatens the jobs of employees. “We need government support for our workers and farmers,” he added.

He urged for digitalization and mechanization of the agriculture sector to improve productivity and ensure food security.

In conclusion, Pedro said that renewed calls for strengthened “Buy Pinoy” movement to promote our Filipino-made products and services.  “It is better if we ourselves have the capacity to produce our own to build up a strong and globally competitive economy,” he added.