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  • Writer: Ziggurat Realestatecorp
    Ziggurat Realestatecorp
  • Apr 13
  • 3 min read

The global economic landscape is shifting again, and this time, the tremors are closer to home.


On April 7, US President Donald Trump announced new tariffs on American imports from dozens of countries, including the Philippines, which faces a 17-percent tariff on its exports.


Other tariffs were also levied on our Southeast Asian neighbors: Vietnam, 46 percent; Thailand, 36 percent; Indonesia, 32 percent; Malaysia, 24 percent; and Cambodia, 49 percent.


Despite local officials' and business groups' optimism about the tariffs, small and medium enterprises (SMEs) will undoubtedly take a hit. As other countries threaten to retaliate with countermeasures, a large-scale global trade war may be on the horizon — eroding business confidence and slowing economic development.


SMEs will likely face higher input costs, disruptions in supplier relationships and lower consumer demand. Even when certain sectors appear shielded or advantaged in the short term, long-term volatility in pricing, procurement delays and retaliatory trade policies can lead to an unpredictable and more expensive operating environment.


These are challenges that disproportionately affect SMEs, which are already dealing with elevated borrowing costs. And while some optimism remains in interest rate cuts due to easing local inflation, the prevailing tone in both the market and the business community is caution.


For SMEs, which make up 99.5 percent of all businesses in the Philippines, this caution is not just prudent — it is essential.


Historically, business success is closely associated with revenue growth, expanding footprints, scaling operations. But in an environment where global policies can shift overnight and supply chains are fragile, adaptability and financial resilience are becoming the more reliable indicators of long-term viability.


First Circle, a financing company providing credit lines to Philippine SMEs, has noticed many of its clients adapting to this shift in business priorities — likely due to persistent inflation and ongoing post-pandemic uncertainty in both domestic and global markets.


While some SMEs are still in pursuit of aggressive revenue growth and market expansion, a growing number are redefining success through the lens of resilience: consistently meeting payroll and supplier obligations; keeping operations lean and maintaining enough financial headroom to navigate disruptions.


For these businesses, stability has become the priority. It means managing risk conservatively and staying operational in turbulent conditions.


Credit line


What does it take to operate with resilience in this economic environment? For all SMEs, the baseline starts with access to fast and flexible financing. Business loans and other traditional debt products, while essential, are often rigid.


In contrast, a credit line offers preapproved access to funds that SMEs can quickly tap into only when needed — without being locked into repayments until disbursement. This kind of financing can mean the difference between surviving a temporary disruption and facing a permanent closure.


SMEs must also focus on using their capital to create buffers for uncertainty. Among the most effective strategies is diversifying revenue streams. This could mean expanding with new product lines, targeting different customer segments or developing alternate sales channels such as e-commerce.


The goal is to reduce dependence on any one market or income source — so that, if one part of the business is disrupted, others can continue to generate cash flow.

Another essential tactic is building emergency cash reserves. While many SMEs operate with tight margins, setting aside a small percentage of monthly revenues into a contingency fund can make a difference when unexpected shocks arise.


These reserves serve as a financial cushion, helping businesses cover payroll, rent or critical inventory during lean periods without relying on high-interest credit or delaying obligations.


These strategic adjustments may require discipline and trade-offs in the short term, but they are key to long-term resilience. Adaptability is no longer optional — it is a core business strategy for SMEs hoping to survive and thrive in uncertain times.


As the world changes, so, too, must our definition of success. For SMEs, it may be time to look beyond growth — and start building businesses that are truly built to last.


Source: Manila Times

  • Writer: Ziggurat Realestatecorp
    Ziggurat Realestatecorp
  • Apr 4
  • 6 min read

US president Donald J. Trump is imposing a bigger-than-expected tariff on Philippine exports to the United States, as part of a broader reciprocal tariff plan that will apply to all its trading partners.


However, Philippine government officials downplayed its impact, saying this was still lower than tariffs imposed on the rest of Southeast Asia.


Finance Secretary Ralph G. Recto said on Thursday that the Philippine economy, which is mainly driven by domestic demand, is “relatively resilient” against trade wars.



“However, as with all countries, we are not spared from the impact of the expected decline in international trade and possible slowdown of global growth due to supply-chain disruptions, higher interest rates, and higher inflation,” Mr. Recto said in a statement.


Trade Secretary Cristina A. Roque said the reciprocal tariffs can provide opportunities for the Philippines as regional competitors will be subjected to higher tariffs.

“We view with guarded optimism that the recent US imposition of reciprocal tariffs will provide strategic opportunities for the Philippines to improve its economic relationship with the US,” she said in a statement.


Ms. Roque said she will request a meeting with her US counterpart to discuss “strengthening” trade relations between the two countries.


On Wednesday, Mr. Trump announced a 10% tariff on all its trading partners, which will take effect on April 5.


The US will also slap individualized higher reciprocal tariffs on major trading partners including the European Union, China, Japan, South Korea and the Philippines, starting April 9.


“Foreign nations will finally be asked to pay for the privilege of access to our market — the biggest market in the world,” Mr. Trump said.


According to an infographic posted by the White House on X, the Philippines will be slapped with a 17% “discounted reciprocal tariff” as the Philippines charges a 34% tariff on the US.


However, an annex document to the executive order on reciprocal tariffs showed the adjusted reciprocal tariff for the Philippines is at 18%.


It was not immediately clear why there was a discrepancy in the tariff rates in the infographic posted on X and the annex document posted on The White House website.

Nonetheless, Philippine officials cited the 17% tariff rate in their press statements.


Among Southeast Asian countries, Cambodia faces the steepest tariff at 49%, followed by Laos (48%), Vietnam (46%), Myanmar (45%), Thailand (37%), Indonesia (32%), Malaysia (24%) and Brunei (24%). Singapore will be imposed a baseline tariff of 10%.


“The imposition of the 17% tariff, which is the second lowest, is not so bad in our opinion. We still see it as somewhat favorable,” Presidential Communications Office Undersecretary Clarissa A. Castro said at a Palace briefing in mixed English and Filipino.


Agriculture Secretary Francisco P. Tiu Laurel, Jr. said the Philippines could take advantage of the relatively lower tariff rate compared with its neighbors to “push for more sales to the US of our products.”


“The new tariffs also put the Philippines in a more advantageous position, more specifically for certain export products like coconuts. With lower tariffs than Thailand, Philippine coconut exports can be more competitive,” Ms. Roque said.


Ms. Roque noted that there are Philippine products that will be exempted from reciprocal tariffs, including copper ores and concentrates and integrated circuits.

According to a White House fact sheet, the reciprocal tariffs will not apply to certain goods, such as semiconductors, copper, pharmaceuticals, gold, and “certain minerals that are not available in the US.”


However, agri-based products, particularly food exports, are not exempted from reciprocal tariffs.


“The recent US measure has made US imports more expensive so that their domestic manufacturers can compete. Equally important for the US is to improve its access to rapidly growing economies such as the Philippines,” Ms. Roque said.


“In this regard, the Philippines aims to actively engage the US in a discussion to facilitate enhanced market access for its key export interests, such as automobiles, dairy products, frozen meat, and soybeans, within the framework of a bilateral free trade agreement.”


Special Assistant to the President for Investment and Economic Affairs Frederick D. Go said some investors may relocate and set up manufacturing facilities in the Philippines, given the relatively lower tariffs on Philippine exports to the US.


Trade Undersecretary Allan B. Gepty said it is important to maintain “good relations” with the US. “It would be good to see how we can seize opportunities from the possible trade diversion and recalibration of some investments in the region,” he said.



‘GAME CHANGER’


Fitch Ratings Head of US Economic Research Olu Sonola said Mr. Trump’s aggressive tariffs are a “game changer, not only for the US economy but for the global economy.”

“Many countries will likely end up in a recession. You can throw most forecasts out the door, if this tariff rate stays on for an extended period of time,” Mr. Sonola said.


Higher tariffs may also drive up prices and hurt demand for Philippine-made goods in the US.


“The US is the biggest export market of the Philippines, so this will have a drag on Philippine growth,” former commissioner of the Philippines Tariff Commission George N. Manzano said in a Viber message.


In 2024, the US was the top destination for Philippine exports, accounting for 17% of the total.


“US importers will put on all these additional tariffs to the selling price in the US,” Foreign Buyers Association of the Philippines  President Robert M. Young said.


“The end result of this is that the Philippines will have difficulties in getting export orders due to lesser or no demand,” he added.


Asked if the Philippines could benefit from the higher tariffs imposed on other countries, Mr. Young pointed out that Philippines has higher costs.


“To start with, the Philippines was selling at a higher price than Vietnam, India, and Cambodia. Meaning, Philippine goods will be the last to be picked up from the shelves,” he said. “Also, Vietnam acted swiftly by reducing their tariff on US goods coming into Vietnam.”


The Philippines exported $12.14 billion worth of commodities to the US in 2024. Of the total, 53% or $6.43 billion were electronic products.


“Electronics and semiconductors, which comprise the bulk of Philippine exports to the US will be vulnerable. Apparel, footwear, and textile products, which rely on preferential trade agreements, may also face competitiveness issues,” Philippine Institute for Development Studies Senior Research Fellow John Paolo R. Rivera said.


“Agricultural exports, such as coconut oil, processed fruits, and seafood, could see a decline in demand due to price sensitivity in the US market,” Mr. Rivera said.


Mr. Rivera noted the direct impact on Philippine gross domestic product (GDP) may not be “immediately severe.”


“It’s a prolonged tariff war could dampen investment sentiment and export growth. If businesses pass on higher costs to consumers, inflation may spike,” he said.


The Development Budget Coordination Committee is targeting 6-8% GDP growth this year. It is also projecting 6% and 5% growth in exports and imports, respectively, this year.


In a report, ANZ Research said it estimated that the reciprocal tariffs could have a “milder impact” on the Philippines, along with Indonesia and India, due to their lower reliance on exports.


“Our understanding is that these tariffs are not final and can be negotiated lower, depending on the extent of reduction in the bilateral trade surplus with the US,” ANZ said.


Data from the Office of the US Trade Representative showed that bilateral trade between the Philippines and the US reached $23.5 billion in 2024 — comprising $9.3 billion in US exports and $14.2 billion in imports.


The US goods trade deficit with the Philippines was $4.9 billion in 2024, up 21.8% from last year.


To mitigate the negative effects of the tariffs, Mr. Young said that “there should be a joint best effort from the Philippine government and private sector to turn their heads to other potential export markets.”


Department of Trade and Industry-Export Marketing Bureau Director Bianca Pearl R. Sykimte said that the department is already looking at new export markets such as in the Middle East and Africa.


Confederation of Wearables Exporters of the Philippines Executive Director Ma. Teresita Jocson-Agoncillo said that the reciprocal tariffs will be imposed on top of the most favored nation (MFN) apparel rates.


“It’s better for us to wait for the US side to publish guidelines. As it looks the reciprocal tariff will be MFN rates plus 17%,” she said in a Viber message. “There is still an advantage, as the Philippines has the lowest (tariff) now, against ASEAN (Association of Southeast Asian Nations) counterparts but note that in the end it can still impact global sourcing and supply chain movement.”


  • Writer: Ziggurat Realestatecorp
    Ziggurat Realestatecorp
  • Mar 25
  • 3 min read

Restrictions are being lifted in New York City and elsewhere in the US to allow offices to be converted into apartments


On the edge of Manhattan’s financial district, a 1960s brutalist tower designed with narrow slits of glass to look like a computer punch card has been given a fitting facelift. Formerly occupied by back-office staff at JPMorgan Chase, the renovated building at 25 Water Street is America’s largest office-to residential conversion to date.


Apartments advertised for rent include studios starting from about $3,600 a month. And in a nod to the hybrid working era, for about $7,700 you can rent a studio with two home offices.


The 1,300-apartment building is among dozens of office conversions that New York City council hopes will help address the housing shortage.


In December the council voted in favor of the Yes for Housing Opportunity proposal, which would add 80,000 housing units beyond otherwise anticipated supply over the next 15 years. The policy includes lifting a restriction on converting offices built after 1961 into housing and moving the cut-off date to 1990 instead. Lawmakers in states across America are exploring quick fixes to boost the supply of housing.


Last year Arizona and Hawaii passed bills permitting vacant offices and other underused commercial space to be converted into homes. California, Hawaii, Massachusetts, Arizona and Rhode Island also passed laws allowing spaces such as basements, garages, attics and backyards to be turned into so called granny flats, or accessory dwelling units, to help increase the provision of affordable homes. Mark Zandi, chief economist at Moody’s Analytics, estimates America has a shortage of 2.8 million affordable homes.


Homelessness across the US rose by more than 18 per cent last year because of high housing costs, natural disasters and a rise in migration to large cities.


A survey in January last year for the US Department of Housing and Urban Development found that 770,000 people were in shelters, temporary housing or had no shelter, the highest number since the annual survey began in 2007.


Academics trace the country’s housing shortage back to the implementation of single-family zoning laws in the 1910s, which restricted certain areas to single family houses and prohibited the construction of apartment buildings and other properties such as factories.


The first such district was established in Berkeley, California, in 1916 to protect the neighborhood from infiltration by the working classes and ethnic minorities.

Jerome Powell, chairman of the US Federal Reserve, warned Congress last week that the central bank could not solve the affordable housing crisis simply by lowering interest rates.


President Trump has signed a presidential memorandum “to deliver emergency price relief for American families”. He ordered federal agencies to come up with proposals to drastically lower the cost of housing and expand supply.


Officials have been told to find red tape to cut that could lower construction costs and so make homes more affordable, and to review land-use policies to promote developments, such as higher density properties.


On this point, Trump has some shared beliefs with liberal politicians. After the devastating wildfires in Los Angeles last month, Gavin Newsom, California’s governor, signed an executive order suspending environmental reviews and ordering state agencies to identify regulations holding back construction.


Housebuilders have welcomed the move towards deregulation. However, they said the Trump administration’s decision to impose 25 per cent tariffs on all steel and aluminium products imported into the US would deter new development and frustrate efforts to rebuild after natural disasters. “Ultimately, consumers will pay for these tariffs in the form of higher home prices,” the National Association of Home Builders said.


Until regulatory reforms are implemented and building materials costs stabilize, more American city workers will be forced to consider creative housing solutions.


Source: The Times

© Copyright 2018 by Ziggurat Real Estate Corp. All Rights Reserved.

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