It does not come as a surprise in fact to learn that Filipino consumers have remained to be the most pessimistic in Asia, with only a third of the population expecting things to improve in the next 12 months.
The online survey of research firm ACNielsen in a way suggests that despite the SARSs less tragic impact on the Philippine economy, our confidence as a nation remains clouded with fear that as other economies in the region recover, we will again be lagging behind.
Political and security uncertainties play such a crucial role in the countrys disappointing performance, while economic performance can best be attributed to luck or the lack of it.
Gross domestic product (GDP) is expected to reach the lower end of the governments 4.2-percent to 5.2-percent target for the year, but Filipinos feel the economys growth is not having much impact on their daily lives.
Even Socio-economic Planning Secretary Romulo Neri admits at least a seven-percent growth in GDP must be achieved to make a dent on the lives of the Filipino people.
Export to which the country is much dependent was almost flat at about a one-percent growth over last year, far off from the at least five-percent year-on-year improvement the government had set for the year.
Sales of Philippine-made products overseas failed to pick up as expected in the second quarter, particularly on concerns that exporters may find it difficult to meet orders on time in the light of security concerns particularly after the July 27 failed military mutiny in Makati.
Nothing was to be expected too from agriculture, a sector comprising at least a fifth of the Philippine economy. Its lackluster performance is primarily due to the El Niño weather disturbance something that is beyond our control. That was the bad luck part.
Yes, the regulatory and legal framework for disposing non-performing assets (NPA) has been set, but the actual thing has yet to take off.
To think the banking sector essentially got what it wanted tax exemptions, fee privileges, and longer time to book their losses arising from the discounted sale of their assets. Could it be that banks are asking for more?
Apparently, the issue really here is the pricing of the assets. Banks obviously want to get more, and the SPVs are of course asking for a steep discount P0.70 for every peso because only through such an arrangement could any margin be made. Most banks, however, would rather wait for the economy to turn around and for the property sector to boom.
Of late, there was news that the central bank received applications from banks intending to dispose P6.1 billion worth of non-performing loans through a dacion en pago or payment-in-kind arrangement. Are we finally seeing the start of a process, albeit long and tedious?
Or perhaps, investors may have been "burned," knowing all too well what happened to their predecessors. Called as messiahs during the 1990 power crisis, investors in the IPP (independent power producer) sector were subsequently pilloried by politicians.
It was easier to join the bandwagon of public outcry and blame the IPPs rather than explain that when in a bind, one has to pay a premium. The economy then was in hostage when "brownouts" occurred without let up.
But when could the right time be? Well, when lights are about to go off and we find ourselves in a bind again. Then our government will start grabbing every proposal that would come their way out of desperation and will pay again a premium.
That time is not too far off from now. Come election time, power failures are expected to hit areas in the Visayas, and then all parts of the country thereafter.
I wish we could have ended the year on a more positive note. The lyrics of an old song keep ringing in my ears as we end 2003 and start a new year, "another day older and deeper in debt."
However, there is also a cliché that goes: "hope springs eternal." So heres wishing you, our readers, prosperity and a better life for the coming new year.
Should you wish to share any insights, write me at Link Edge, 4th Floor, 156 Valero Street, Salcedo Village, 1227 Makati City. Or e-mail me at reygamboa@linkedge.biz. If you wish to view the previous columns, you may visit my website at http://bizlinks.linkedge.biz.