Gains made but challenges remain
The government still has to act on numerous challenges, despite gains touted by President Ferdinand Marcos Jr. during his State of the Nation Address (SONA), initial private sector reactions to Monday's policy speech indicated.
Marcos promised, among others, to go after profiteers, improve supply chains to bring down prices, deliver much-needed infrastructure and raise education standards. He also called on Congress to pass critical reforms, including new tax and fiscal measures.
"The major challenges [are how to] further reduce prices/inflation, prevent water interruptions, increase power supply and bring down electricity rates, more inclusive economic growth and development to bring more people out of poverty," Rizal Commercial Banking Corp. chief economist Michael Ricafort said.
"There is a need also to implement more tax and fiscal reform measures to better manage debt management and make it sustainable for the long term and future generations," he added.
Benedicta Du-Baladad, president of the Management Association of the Philippines, said the organization welcomed initiatives announced by the President to address pressing issues such as malnutrition, low education levels, jobs and social services, but stressed that the income gap remained "very wide."
"A more equitable income distribution and redistribution should be at the front and center of our economic development," she added, noting that more than half, or 57 percent, of the population is "considered as low income class and living on the poverty line and below." "This is a heavy burden that the government has to address with urgency," Du-Baladad continued.
"Thus, we urge the government to continue taking steps to further narrow the income disparity and ensure that economic gains redound to a more equitable distribution of wealth across the board." And while Marcos may have touted the creation of the Maharlika Investment Fund as a means of harnessing unused government funds for development, BDO Capital & Investment Corp. President Eduardo Francisco reiterated the need for competent people to run the wealth fund.
"Nice if there are enough independent members of the board also from the private sector in addition to economic managers," he said, referring to Marcos' having said that "a group of internationally recognized economic managers" would be overseeing the fund's operations.
Francisco also said that he was "hopeful for education, health, agri, climate change, infrastructure, and new business and investment." The European Chamber of Commerce of the Philippines (ECCP), for its part, said the Philippines needed to make itself more attractive to investments.
"The ECCP extends its appreciation to President Ferdinand Marcos Jr. for delivering the 2023 SONA and for the current administration's commitment to addressing the nation's many pressing challenges," it said in a statement.
"While the P3.9 trillion total investment pledges with the potential to generate 175,000 jobs are indeed promising, we look to government to further solidify the country's position as an attractive investment destination through incentives schemes and the proper implementation of green lanes to boost the country's competitiveness and facilitate ease of doing business," it added.
"To further establish the Philippines' position in the global arena, it is critical to sustain investments in both hard and soft infrastructure." British Chamber of Commerce in the Philippines Executive Director Chris Nelson, meanwhile, said they were happy that Marcos had touched on the ease of doing business in the country.
"I think the business environment of the country continues to improve, which links in the overall economic progress," he told The Manila Times.
Nelson expressed optimism about infrastructure investments and the outlook for priority legislation such as taxes on single-use plastics and value-added taxes on digital services, among others.
Marcos, he claimed, had delivered on promises made in last year's SONA.
"The economic managers produced a very sound performance to be commended," Nelson said. "We want to keep that momentum going forward."
Source: Manila Times