Wall Street Journal Asia reports on turnaround of RP economy
Manila (2 September) -- The Wall Street Journal Asia said that the Philippines, the "perpetual sick man of Asia," has been making an unexpected turnaround.
Press Secretary and Presidential Spokesman Ignacio R. Bunye said that in its August 31 banner story, titled "Comeback Trail for Philippine Economy, Harsh Remedies Paying Off," the Hong Kong-based newspaper reported that this year, the Philippine economy is "expected to post its fastest growth rate since the early 1990s."
Datelined Manila and written by James Hookway, the WSJA report said that "almost lost amid the international excitement about the growth of China, India and Vietnam – the Philippines has been rebounding."
"This year, the nation's economy is expected to post its fastest growth rate since the early 1990s, despite the economic shadow cast by the global credit squeeze sparked by problems in the U.S. mortgage market.
"The Philippine economy grew at a 7.5% annual rate in the second quarter. The stock market has soared over the past two years, although it has faltered recently.
"Foreign investors are coming back, attracted by the Philippines' young population -- the average age of its 89 million people is 22 -- and the widespread use of English, a legacy of its past as an American colony. The call-center business is thriving," Hookway reported.
In his weekly column, The View From the Palace, Bunye said Hookway gave much of the credit to President Gloria Macapagal-Arroyo whose politically risky tax reforms "showed investors the nation was serious about putting its house in order after years of half-hearted attempts to cut its budget deficit."
Hookway quoted the President as saying: "I knew the risks, but I decided that if we have to bite the bullet, then that's what we would do."
Bunye said that the politically risky reforms that the President instituted topped off by the Expanded Value Added Tax (EVAT) have "yielded huge dividends."
"For the first time in a generation, we now have the much-needed revenues with which the President intends to improve the lives of the people. Her mantra nowadays is 'Invest. Invest. Invest.'"
He said the Chief Executive "intends to invest in human capital and physical infrastructure which will make our country even more competitive and more progressive."
"You will notice this in the proposed 2007 budget. The biggest proposed increases in expenditures are in education, health, social services and in roads, ports, airports and agricultural infrastructure," Bunye said.
Aside from the banner story, the August 31 issue of WSJA also featured two articles on the country's economic recovery. (PIA) [top]