Businessmirror january 31, 2016

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A broader look at today’s business

n Sunday, January 31, 2016 Vol. 11 No. 115

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Philippine economic growth seen to slow to 5.5% in 2016 D

week ahead

ECONOMIC DATA PREVIEW Peso

n Previous week: The local currency neared the 48 territory in the early days of the week’s trade, but the weakness was subdued by the strong growth of the country. The peso on Monday hit 47.88 to a dollar, depreciating to its lowest point of the week on Tuesday at 47.995 to a dollar. The peso then started to appreciate on Wednesday at 47.815 to a dollar and at 47.73 to a dollar on Thursday. The peso ended the week at 47.65 to a dollar. The average trade value of the peso during the week was at 47.814 to a dollar and the total traded value was at $2.89 billion. n Week ahead: After the GDP report is out, markets are seen to take cues from data coming from the US. Risk on sentiment is also seen to spill over next year as the country exudes good fundamentals amid external volatility.

Inflation (January)

n December inflation: As widely expected by the market, the country’s average inflation rate on average for the year has formally missed its 2015 target range, with the Philippine Statistics Authority’s (PSA) announcement on Tuesday of a 1.5-percent inflation rate in December 2015. “But our forecasts for 2016 to 2017 show an inflation path consistent with the national government’s target of 2 percent to 4 percent,” Central Bank Gov. Amando M.

See “Outlook,” A2

By Bianca Cuaresma

US economy faces doldrums as consumers temper spending

ESPITE affirmations of the country’s strong growth momentum following the Philippine Statistics Authority’s announcement of a recovery in the country’s GDP expansion rate in the fourth quarter of the year, the Philippines is still seen to lose traction this year as external factors continue to weigh in on the economy. In a reaction to the country’s October-to-December growth report, Barclays Research said the Philippines is still poised to grow slower in 2016 at 5.5 percent, although the GDP grew 6.3 percent in the fourth quarter of 2015. The fourth-quarter GDP expansion brought the average 2015 Philippine growth to 5.8 percent. Barclays’s statement is a contrast to the government’s 7-percent to 8-percent target growth

range, which has been said to be “achievable” by government officials following the positive sentiment brought about by the fourthquarter growth. Barclays said the gains in the expected pickup in government spending is expected to be negated by the soft global growth outlook for the year. “Although [the GDP] print was above expectations, we remain comfortable with our 2016 growth

A customer refuels her car at a Costco in Robinson Township, Pennsylvania. The plunging price of oil in 2016 is dragging stock markets to their worst start to a year ever, even though low fuel prices are great for consumers and most companies. AP/Gene J. Puskar

T

HE US economy expanded at a slower pace in the fourth quarter, as households tempered spending and businesses cut back on capital investment and adjusted inventories. GDP rose at a 0.7-percent annualized rate in the three months ended in December after a 2-percent gain in the third quarter, Commerce Department figures showed on Friday. The advance was in line with the Bloomberg survey

See “Growth,” A2

One-half of PHL population now has access to Internet By Lorenz S. Marasigan

E

NTERPRISES— from micro to large companies—can now access almost half of the country’s population through the Internet. With Internet penetration in the Philippines now at about 44 percent, small and medium enterprises (SMEs) have the potential of expanding their businesses through the Web. However, these companies must have the guts to also invest in digital technology to effectively maximize their potential for growth. “There are over 95,000 small to medium enterprises in the country, with each and every one having the potential to grow and compete on a global scale. With a wide assort-

PESO exchange rates n US 47.8230

32M

Number of mobile Internet users in the Philippines

ment of online tools now within reach, there is no better time to be an SME than today,” IP Converge Data Services Inc. (IPC) President Reynaldo R. Huergas said. Customers are largely mobile, with about 32 million active mobile Internet users in the Philippines. This makes going digital and embracing the consumerization of information technology (IT), now more critical than ever, Huergas said. Enterprises need to be easily reached by their customers through See “Internet,” A2

median forecast of 0.8 percent. Growth has downshifted, as producers contend with slowing markets abroad; the negative effect on exports from a stronger dollar; and plunging oil prices that has caused drilling firms to retrench. Consumers, enjoying the fruits of a robust labor market and cheaper fuel bills, will have to pick up the slack if growth is expected to get back on track. “The economy, perhaps, isn’t

quite as strong as we thought it was—there’s clearly some very weak spots, but there’s a solid foundation to growth,” said Nariman Behravesh, chief economist at IHS Inc. in Lexington, Massachusetts, who is the best forecaster of GDP over the past two years, according to data compiled by Bloomberg. Even after the fourth-quarter slowdown, “the stars are aligned for consumer spending to return.” Continued on A2

Luzon has 9 of best places to live in 10 best places to live in

HDI

Benguet

0.842

Metro Manila

0.829

Rizal

0.805

Cavite

0.773

Ilocos Norte

0.731

Bataan

0.729

Pampanga

0.727

Laguna

0.721

Bulacan

0.705

Iloilo

0.691

M

By Cai U. Ordinario

OST of the 10 best places to live in in the Philippines are in Luzon, according to the 2012 Human Development Index (HDI) data released by the Philippine Statistics Authority (PSA). Based on the HDI data, PSA said the three places that got the highest HDI are Benguet, Metro Manila and Rizal, which had the highest HDI of 0.842, 0.829 and 0.805, respectively. The HDI is measured based on three indices, life expectancy index, education index, and income index. “First of all, incomes, access to resources...iyong mga health, etc. Siguro makikita mo in terms of distribution ng educational opportunities, health facilities,” National Economic and Development Authority (Neda) Officer in Charge Emmanuel F. Esguerra said. “It reflects ang previous actions mo with respect to [public] investment.” Other places in Luzon that had high HDI are Cavite, with an HDI of 0.773, followed by Ilocos Norte, 0.731; Bataan, 0.729; Pampanga, 0.727; Laguna, 0.721; and Bulacan, 0.705.

See “Luzon,” A2

n japan 0.4025 n UK 68.6595 n HK 6.1370 n CHINA 7.2730 n singapore 33.4965 n australia 33.9074 n EU 52.3184 n SAUDI arabia 12.7528

Source: BSP (29 January 2016 )


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