The country faces a bleak investment outlook, and all eyes are on President Ferdinand Marcos Jr. to lead the revival.
The newly elected Philippines president Ferdinand Marcos Jr. has a task at hand. The country is still recovering from the financial impact of the pandemic, and a bleak investment outlook is an added concern. A faster economic revival is the primary expectation from the new regime.
To bring about changes, Marcos Jr. wants to first mend the country’s relations with the European Union (EU). Outgoing president Rodrigo Duterte had a tumultuous relationship with the EU. Marcos Jr. will pursue a foreign policy where the Philippines is a “friend to all, enemy to none”. A senior diplomat with rich experience in Europe has also been appointed as the government’s top foreign envoy.
The move to improve relations comes at a time when the Philippines’ GDP forecast has been lowered.
Bringing back growth
Upon taking charge, the finance team of President Marcos Jr. announced that GDP growth will be 6.5-7.5% this year, compared to the 7-8% projection by the previous administration.
However, the Marcos Jr. government expects the Philippines’ economy to grow by 6.5-8% annually from 2023 to 2028, higher than the Duterte administration’s estimate of 6-7%.
Agriculture and food security are among the biggest priorities of the new government. Marcos Jr., who is also the secretary of the agriculture department, wants to increase the production of staple crops such as rice and corn.
Simultaneously, the government also wants to support small, medium, and micro enterprises in the country. Marcos Jr. also wants public-private partnerships to boost MSMEs.
The Marcos Jr. government is having a re-look at past projects. His administration wants to renegotiate loan agreements with China pertaining to $4.9 billion worth of railway projects in the Philippines.
Meanwhile, a think-tank report said that the investment outlook in the Philippines is deteriorating. The high inflation rate of 6.1% in June 2022 and depleting savings are to blame.
Infrastructure woes continue in the country. Analysts have said that infrastructure will be the key focus under the Marcos Jr. regime. Improving tourism infrastructure will be another priority to boost the country’s recovery, said the president.
While the administration has not yet revealed the detailed plans for phase-wise revival, agriculture, infrastructure, and tourism are the three critical reform sectors.
Ray of hope
At present, the Philippines is among the fastest-growing economies in ASEAN. The first quarter GDP growth was 8.3%.
However, a complete revival will depend on the pace at which the government attracts new investments in the infrastructure, technology, and tourism sectors. The Philippines has remained resilient so far. President Ferdinand Marcos Jr.’s policies to implement new projects and generate employment will hold the key to its economic future.
Stay up to update with our latest news.