Local bourse backs continuity of macroeconomic policies

CEBU, Philippines - The Philippine Stock Exchange backed President Duterte's plan to maintain current macroeconomic policies that will facilitate stable inflation and manage the fiscal environment.

"The President's major economic pronouncement should be good for the capital markets as investors are always looking for stability in policies. The commitment of the government to increase infrastructure spending should only be additive to the current high growth that we have been experiencing," PSE President Hans B. Sicat said in a statement.

The PSE also lauds Duterte's statement on pursuing reforms to ensure competitiveness and ease of doing business.

"In the face of globalization and economic integration, the standards for measuring the competitiveness of our industries must be viewed beyond the country's economic territory," Sicat said.

"We need to recognize that certain industries require massive amounts of capital, and options that allow consolidation, and liberalization of foreign ownership restrictions, can improve the competitiveness of these sectors," the PSE statement further quoted Sicat as saying.

In his SONA last Monday, Duterte also announced that his administration will cut down income tax rates and stop red tape in government agencies.

Since Duterte took office, the market has been reacting pretty well.

Year-to-date, the benchmark index gained 16 percent and has breached the 8,000-mark after Duterte took office.

Meanwhile, the stock exchange is also expecting the results of the review of the implementing guidelines of the Real Estate Investment Trust (REIT).

"We hope that the review spearheaded by the Department of Finance will lead to the resolution of the contentious issues that have clearly prevented companies from applying under the REIT law. REITs should unlock the potential not just of the real estate sector, but also various infrastructure projects that are in need of significant funding and critical to the country’s economic growth," Sicat said. (FREEMAN)