Our GDP twin shocks: Hermès and Hormuz

I could not help but laugh when the indefatigable Jun Neri, the lead economist at BPI, shared his thoughts on the latest jaw-dropping snail-pace performance of our economy at just 2.8 percent growth in the first quarter of the year.

“It’s due to a combination of Hormuz (external) and Hermès (internal),” Jun said in one of the Viber groups.

It was meant to add humor to an otherwise lamentable situation we have spiraled down into, but it has captured our situation well.

Hermès

We all know what Jun meant. In this context, Hermès has become a representation of the country’s pervasive corruption, though this is by no means the French brand’s fault.

Thieves simply love to pour their stolen money into luxury goods.

Hermès, of course, is the luxury bag brand that’s a favorite among Filipinos, including the corrupt, their wives and their nepo babies. Its prices can reach P2 million or more.

It’s certainly an accurate representation of greedy politicians’ penchant for luxury.

I heard that a prominent figure currently facing a legal complaint in the Philippines allegedly committed the crime to buy the latest Hermès bag.

But there are many others. For instance, the men love luxury timepieces and sleek cars whose costs far exceed a government official’s or lawmaker’s salary.

In short, the flood control corruption scandal which broke out last year negatively impacted the country’s investments and affected the economy.

Infra spending tightened. Even honest contractors were not being paid on time. They scaled back work and investments. Investors were waiting on the sidelines.

And because of the scandal, the corrupt tried to lie low, drastically cutting spending on luxury goods. And yet, despite all the revelations, a really big fish has yet to land behind bars.

What a sad state of affairs!

Hormuz

And then there’s the second shock.

The US and Israel’s war against Iran has severely cut the flow of goods, particularly oil, along the Strait of Hormuz, disrupting our economy. Note that the war erupted on Feb. 28, which means that the latest GDP performance only covered the first month of the war.

We are now into the third month of this ugly conflict with still no visible ending in sight. We continue to be affected as the country imports 98 percent of its fuel requirements.

For this week, fuel prices are shaping up to be mixed. Diesel and kerosene are headed for rollbacks while gasoline is expected to rise.

At present, diesel pump prices range from P78 to P99 per liter while premium gasoline can go as high as P110 per liter.

The Department of Energy has repeatedly assured the public that there’s no need to panic. We have enough inventory, says Energy Secretary Sharon Garin.

For gasoline, the current supply is enough to last for 53 days; for diesel, 48 days; for kerosene, 165 days and for jet fuel, 73 days.

I asked former energy secretary Jericho Petilla, who is now the governor of Leyte, what he would have done if he were in the position now.

First of all, he said, he really wouldn’t want to be in Sec. Garin’s shoes now. It’s a tough situation, after all.

But if he were still energy chief, he would make sure that oil prices remain transparent. The DOE should strictly monitor prices and provide the public with the prices of gasoline per area or per station if possible. This would create real competition and provide the public with more choices.

He would also show the real picture, he said, instead of painting an overly optimistic scenario.

Against this backdrop of twin shocks and a pathetic economic growth, what can we expect?

Economic Secretary Arsi Balisacan said the government would accelerate spending and project implementation in the coming months.

To complement this, I urge the government to also rally the private sector to invest more, create jobs and help pump-prime the economy.

All hands must be on deck.

Hotel101 Global delivers explosive 2025 growth

Believe it or not, despite the upended global order, a Filipino brand is making waves on the world stage.

Nasdaq-listed Hotel101 Global Holdings is showing a business scaling at remarkable speed.

Its 2025 financial highlights are as follows:

Total revenue: $75,866,090, up 1,177.67 percent versus 2024.

Operating income: $1,430,118, turning profitable versus a net loss of $4,885,359 in 2024.

Gross “Happy Room” sales margin: $32,449,145, up by 43.14 percent, above the historical 41.18 percent.

Commenting on this, fund manager and analyst Eric Jurado says the company’s growth continues to be driven primarily by Happy Room sales.

This, he said, means strong execution in its asset-light model. Margins remain healthy and slightly ahead of historical levels, suggesting disciplined cost control even as the business scales rapidly.

Jurado maintains a 2031 price target of $25.63 per share, implying 315 percent upside from its May 4, 2026 closing price of $6.17.

Tycoon Injap Sia III, the visionary behind Hotel101 Global, has reasons to pop the champagne.

I congratulated him for the company’s strong performance. He said that the inflection point is about to start. He also showed me a video of  Hotel101 Madrid’s lobby brimming with guests.

Hotel101, he added, is on track to hitting its goal of one million rooms across 100 countries.

That’s certainly good news for the Filipino brand, especially in these challenging times.

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Email: [email protected]. Follow her on X @eyesgonzales. Column archives at EyesWideOpen on FB.