SOLID FUNDAMENTALS

Bouncing back from the brink after a disruptive pandemic triggered a food and energy crisis, Philippines is resisting the global recessionary headwinds, cushioned by strong fundamentals, prudent fiscal management and reforms in key sectors. The pent-up domestic demand following the removal of pandemic restrictions propped up economic growth last year and continues supporting consumer spending this year. The Philippine economy’s growth relies on the micro, small and medium enterprises in the country – much like other ASEAN members. Cognizant of its limiting factors like poor infrastructure, high power costs, slow broadband connections and regulatory inconsistencies, the government has undertaken focused policy decisions to catch up with the ASEAN-5 peers Indonesia, Malaysia, Singapore and Thailand.

Its large, relatively low-cost English-speaking workforce, coupled with the benefits of free trade zones, special economic zones and targeted business incentives, make Philippines an attractive destination for investors. While majority of FDI inflows are in manufacturing, energy, financial services and real estate sectors, the country’s start-up ecosystem is at an inflection point and emerging as a Southeast Asian hot spot for investors seeking solid returns from young tech companies. Another area with much potential is green infrastructure, with the Philippine government committed to achieving its carbon targets by ensuring access to climate finance, supporting technology development and transfer, providing capacity building, and implementing circular economy and sustainable consumption and production practices.