Cebu News

Seen this 2018: Strong economy

Ehda M. Dagooc - The Freeman
Seen this 2018: Strong economy

As building after building alters the Cebu skyline year after year, businessmen are optimistic of the province's economic trajectory this 2018.  Aldo Nelbert Banaynal

CEBU, Philippines — The year 2018 will bring Cebu to economic highs regardless of political climate, locally and nationally.

This is the forecast of prime movers of the local economy for 2018 who said Cebu will start to reap the fruits of the “year of abundance” that was 2017.

"It’s a building year, at the same time, a harvest year for Cebu," said Melanie Ng, president of the Cebu Chamber of Commerce and Industry (CCCI).

She said Cebu will also continue to attract more seeds of investments and interests from capitalists all over the world.

Ng said tourism will serve as a strong magnet for high growth, which will also give birth to more investments across industries like retail and real estate, among others.

The top employer industry, the Business Process Outsourcing (BPO) industry, will sustain its vigor, but growth in terms of employment volume is seen to be tamer this 2018, as Cebu is positioned to catch high value services, which will not need large numbers of people compared to voice-related services.

High value outsourcing falls under the Knowledge Process Outsourcing (KPO) category, which requires highly skilled talents. Monthly salary usually starts from P30,000, depending on a company’s skills requirement.

"We have seen the strong interest from investors around the world, especially from China, Japan, and other countries through several visits and trade missions in 2017," Ng said.

Though the avalanche of international investors continues to come in, materialization in terms of actual investments is expected to happen this year.

Ng’s counterpart in Mandaue City, Glenn Soco, shares her prediction.

Soco, president of the Mandaue Chamber of Commerce and Industry (MCCI), said 2018 will be a "breakaway" year for Cebu, meaning, Cebu will show that it can stand on its own economically.

Soco believes the opening of the second Mactan Cebu International Airport Terminal will bring Cebu to a historical growth performance.

Soco said Cebu has been a consistent star performer in terms of economic growth, regardless of crises, man-made problems, and even calamities.

Now that the Philippines is being touted as the next economic tiger or economic powerhouse in Asia, Cebu is expected to take the spotlight in this trademark.

The Duterte government's build-build-build thrust is another fuel that supports the promising outlook, Soco added.

Intact Drivers

This on-the-ground standpoint is backed by academic and research-based perspective from economist and financial analyst Alvin Arogo who said that the country’s economy will remain vibrant and healthy in 2018 regardless of the twists and turns in politics.

"There are things that are more structural in nature and economic drivers in the Philippines will remain intact and not affected by politics," Arogo said.

The Philippine economy is on for sweeping growth and will remain in place whoever is on top, dismissing fears that the unpopular decisions made or will be made by the government may affect direly in the country's economic pump.

Aside from the strong economic fundamentals, sound policies implemented by the Bangko Sentral Ng Pilipinas (BSP) in 2002 and the execution of Expanded Value Added Tax (EVAT) in 2007, among others, have helped strengthen the foundation of the country’s economic vibrancy.

EVAT, for one, has placed the Philippines in a better position that resulted in impressive ratings posted consistently by foreign credit rating entities.

Consumer Base

The country's hard-to-beat economic fuel is its demographics. The over 100 million population (and growing) continues to attract investors to pour money in the Philippines.

A peso spent by every Filipino, for instance, could reap a million peso revenue.

The expanding group of median aged Filipinos is also an added boost to the economy. This group of consumers spends more, earns high, and is surprisingly productive.

"Whoever is in power will not change population and the median age in five years time," Arogo said.

The Philippines' "sweet spot" flirts with investors regardless of political issues, he said.

Trade, Export

 The National Economic and Development Authority (NEDA) announced recently that continued exports growth, economic cooperation, and trade facilitation initiatives will sustain trade gains, as total trade records double-digit growth as of October 2017.

NEDA-attached agency Philippine Statistics Authority (PSA) has reported that the country’s total trade grew by 10.4 percent year-on-year in October 2017, a pickup from the 4.6-percent growth in September.

Exports recorded its 11th consecutive month of positive growth at 6.6 percent while imports posted a double-digit growth of 13.1 percent.

Total merchandise trade grew by 11.2 percent for the first six months of 2017 compared to the first half of 2016.

According to NEDA, 2018 is seen to reveal another round of improved performances in exports of agricultural products and semiconductors, which continue to comprise a huge portion of Philippine exports.

The business players in Cebu believe that challenges and problems will always be there in order to keep the economic speed on balance, but what is certain is that 2018 will bring a flamboyant, colourful, and exciting economic journey.

How this promising outlook can be experienced by Cebuanos will depend on how they will play their cards and the kind of mindset one will have.

"We have to be alert in grabbing and sensing every opportunity that usually are just in front of us," Ng said. — /JMO (FREEMANNEWS)

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