Cebu leaders: GDP growth shows gov’t on right track
BUSINESS leaders in Cebu said the 7.1 percent third quarter GDP growth is an indication that the government’s thrust towards transparency and more active involvement from the private sector has placed the country on the right path.
In an interview yesterday, Cebu Chamber of Commerce and Industry president Prudencio Gesta saidthe current administration is doing something right for the economy to grow more robustly.
“Our strong gross domestic product performance can simply be traced to strong domestic consumption attributed to higher income power of the general population mostly generated from the strong inward remittances from OFWs (overseas Filipino workers) and from the outsourcing and ICT (information communication technology) sector,” he said.
Higher government spending on infrastructure has also helpedfuel growth coupled by the country’s improved credit rating from Moodys and Standard and Poor’s, Gesta added.
He said the fight against corruption must go on as it helps government earn more and the revenue will then be used to fund important infrastructure projects that will fuel industrial growth.
“We can expect higher government spending which can spur more economic activities and thus sustain our good GDP performance,” Gesta said.
Tool for opportunity
Mandaue Chamber of Commerce and Industry president Philip N. Tan agreed with Gesta saying the transformation that President Benigno Aquino III wants to happen for the country is the very tool that will open more opportunities for the country including Cebu which is one of the country’s investment hubs.
Cebu Business Club president Gordon Alan Joseph said they are pleased with the result and that to sustain this, the government must turn this into an inclusive growth by creating more job opportunities.
“To create jobs, we need to revive industry and manufacturing in the country together, but to do this we need to have a clear strategy to attract more foreign investors,” Joseph said as he noted that FDI (foreign direct investment) rates have not reached its full potential in the last 10 years despite all the good news about the Philippines.
According to central bank statistics, the net FDI inflow reached $1.26 billion in 2012, which is a 2.8 percent decrease from the $1.298 billion registered the previous year.
“We need to leverage our stability to attract FDI while working on improving infrastructure and improve the ease of doing business here. The time and opportunity is now. We must grab it aggressively and act decisively,” he said.
No surprise
Hotel Resorts and Restaurant Association of Cebu president Hans Hauri said the remarkable third quarter performance is “not a surprise.”
“It is not a complete surprise because the government has prepared for those numbers be it the improved image of the country through reduction of corruption, the healthy balance sheets it has as testimony and the low interest rates although the strong exchange rates could become a deterent,” he said.
Hauri noted that the economy rests on several pillars including mining, tourism, real estate, agriculture and IT and BPO (business process outsourcing).
Shift focus
He added that for the long term, the country needs to shift its focus on manufacturing to avoid being too dependent on the services sector like the BPOs, medical, tourism and airlines.
“We need to climb the value chain through building competence of manual skills to sustain healthy growth of the economy. We have a bright future, always had, but we were just a bit underestimated. The strength lies in its people. Just look at our OFWs, ” Hauri said.
Philippine Retailers Association chairman Melanie Ng attributes the economic upswing to the strong partnership between the private sector and the government which has helped create an more investor-friendly climate.
“It means we are on the right track. All the initiatives of both the private and public sector are on track towards growth for our economy which radiates an enticing investor environment. Sustaining this positive investor environment is a major contributor towards sustaining the growth,” he said.
Economy
During the first quarter, the economy grew by 6.4 percent and then slowed down a bit to 5.9 percent in the second quarter. The country however, managed to maintain its rank as the second best performing economy in Asia next to China.
This quarter, the country has become best performing economy in the Southeast Asian region surpassing Indonesia and Malaysia which posted growth of 6.2 percent and 5.2 percent, respectively.
With the third quarter performance, the country’s average growth for the last nine months now stands at 6.5 percent, which is already above the government’s official target of five to six percent.
