Hope and Economics (7.13.2009 update)By Randell Tiongson on July 13th, 2009
Just thought of posting some highlights — sorry, a bit ‘nose-bleed’ but this information is quite important to us Pinoys. The information can’t really say we are headed for economic recovery, but it means there are some economic activity that can give us hope. Hope, after all, is eternal right?
A concern is the slower pace of excports especially if you compare it from last year. However, May numbers showed a good improvement from April numbers and let’s hope we can sustain the moderate increase. A global softening of the electronics market has continued to affect our electronincs exports industry especially if you compare it from last year… but it is better in May as compared to April still. I’ll take any form of good news anytime of the day!
Foreign Direct Investments is a good indication of economic activity and reversal of the outflow trend is a much welcome break we all need. Because of the gloabl financial crisis, capital moved out of emerging markets like the Philippines to seek safer havens. A reversal in FDI flow is a good indication that things might be looking a little brighter for us Pinoys.
Fiscal issues continue to besiege us and it will be very difficult to balance the budget because government is trying to spice up the economy; it times when consumer spending is low, government tries to spend more to ‘pump-prime’ the economy. It looks like RP wants to take advantage of the low interest environment to float bonds which we all desperately need. While we can’t avoid borrowing, at least our cost of borrowin is much lower. Just to note that consumer debt (like credit cards) are still something we should avoid, ok? We are not the Republic of the Philippines, haha.
Things are really ambivalent but I am still one who clings to hope… hope that things will look brighter for all of us soon.
Hope is easy when we are connected to the real source of hope — “We have this hope as an anchor for the soul, firm and secure. It enters the inner sanctuary behind the curtain…” — Hebrews 6:19
1. Export falls at slower pace in May
- Philippine exports continued to fall in May albeit at a slower pace
- NSO disclosed that May exports totaled $3.08 bn, down 27% Yoy
- However this is up 10% Mom as exports reached $3 bn per month mark in May versus $2.8 bn in April
- YTD exports still down 34.5% to $13.8 bn
- Electronics declined 27% yoy to $1.8 bn in May; Compared to last month, elctronics exports were up by 8%
2. Foreign Direct Investments inflows reach $601 mn in April
- FDI surged to positive flow of $601 mn in April, reversing the outflow trend in Jan to March of $27 mn
- April inflow considered considered an aberation as it featured Kirin Holdings’ investment in San Miguel Brewery
- Exclusive of the $1.1 bn inflow from Kirin, FDI wouldve posted a decline of $500 mn for the month
- FDI inflow in the first four months of the year reached $648 million, up 29.1% from a year earlier.
3. Philippines approved $1 bn bond issue
- Philippine central bank approved plans to raise as much as $1 billion through an international bond issue
- Will either be through a global bond or a eurobond proceeds to finance the widening deficit.
- Budget deficit target for 2009 raised to P250 bn and can even reach P320 bn or 4% of GDP
“Hope is the companion of power, and mother of success; for who so hopes strongly has within him the gift of miracles.”
— Samuel Smiles
“Expect to have hope rekindled. Expect your prayers to be answered in wondrous ways. The dry seasons in life do not last. The spring rains will come again.” — Sarah Ban Breathnach