Giant business groups to support the Marcos-Duterte administration

It noted that J.P. Morgan has confirmed that it was "misquoted" after anti-Marcos media reports claimed that it had ranked the Philippines last among Southeast Asian economies.

By Edward Era Barbacena

TWO of the country's most powerful business groups are willing to work with President-elect Ferdinand "Bongbong" Marcos Jr.'s administration in sustaining economic targets that will speed up the country's recovery.

Marcos' office said on Friday it has received separate statements of support from the Philippine Chamber of Commerce and Industry (PCCI) and Joint Foreign Chambers (JFC).

PCCI is asking the public to give the new administration time to develop and share their development plans. 

"Let's stay positive," said PCCI President George Barcelon, stressing that Marcos' economic managers must address both internal and external issues.

Barcelon said the incoming administration will face the same financial challenges other countries do, particularly debt and inflation woes triggered by the prolonged Covid-19 pandemic and, more recently, the war in Ukraine.

"As business chambers, we hope to continue to work closely with government officials at all levels throughout the country for the recovery from the pandemic and to maintain high levels of GDP (gross domestic product) growth, infrastructure development, job creation, and FDI (foreign direct investment) inflows best achieved by continuing the governance and policies of the current and previous administrations," JFC said.

Another business group, the American Chamber of Commerce of the Philippines (AmCham), said it will continue to work closely with government officials at all levels to sustain high levels of GDP growth, infrastructure development, job creation and FDI inflows.

In its statement on Friday, AmCham congratulated "the Philippines and the Filipino people for conducting a successful campaign period and elections — showing again the strength of its democracy."

"AmCham remains optimistic that good governance and policies of the previous administrations will be maintained by the newly elected officials of the Philippine government," it added.

Marcos' office also announced that American financial services firm J.P. Morgan has made it clear that the Philippines' dropping to the bottom of its investment list had nothing to do with the May 9 election results.

It noted that J.P. Morgan has confirmed that it was "misquoted" after anti-Marcos media reports claimed that it had ranked the Philippines last among Southeast Asian economies.

"Our views on the Philippines are driven by long-term global and local macroeconomic fundamentals, and not by election results or outcomes in general," Patricia Anne Javier-Gutierrez, executive director and Philippines head of communications at J.P. Morgan, was quoted as saying by the Marcos camp.

"As stated in our May 8 Philippine Strategy report, we think the Philippines faces a challenging macroeconomic outlook post 2022 regardless of the outcome of the May 2022 presidential elections," Javier-Gutierrez said.

Marcos' office said J.P. Morgan maintained that its published views were created before the election outcome was known and were not based on the results of national surveys, since they had already written remarks to the media to clarify the claim.

"We further say in our report that re-opening benefits are expected to underpin strong 2022 GDP and earnings growth, but this benefit will likely wane in 2023, underscoring the macro challenges faced in the future," she added.

The economy grew by 8.3 percent in the first quarter of this year, reversing a 3.8 percent slide in the same period the previous year.

The country's economic managers attributed the GDP expansion to the government's adept management of the threats posed by the Covid-19 pandemic back in January when the Omicron variant was first detected.

"On February 1, we shifted our economic centers to Alert Level 2. By the end of March, around 70 percent of the economy was placed in Alert Level 1. This quick turnaround in the first quarter shows that we can win both the economic and health battles," they said.

Marcos' spokesman Victor Rodriguez also said it was "premature" for investors to forecast a gloomy economy under the incoming administration.

Quoting a report from Fitch Ratings, Rodriguez said the clear mandate delivered by the election bodes well for the ability of the new administration to implement its agenda that is broadly in line with existing policies of the Duterte government.

Last February, Fitch affirmed the country's BBB credit rating and negative outlook.

Rodriguez also noted that the debt watcher said it would be able to better assess the impact of the Marcos government's policy agenda once key appointments are finalized.

"So, I think it's very clear, when taken to its proper context, the report of Fitch and it will also worth stressing that all the negative news that have been coming out lately and they're attributing it to the May 9 elections has been effectively debunked with the statement of Fitch," Rodriguez told reporters.

"As well, and I quote, we will be able to better assess the impact of the Marcos government's policy agenda once the appointments are finalized notably within the economic team. So everything, all else, I think, is premature," he said.

Marcos will inherit a strong and recovering economy, but it also has to contend with a record P12 trillion national debt due to the heavy borrowings during the pandemic and the Build, Build, Build program.

He has said the choice of economic managers "will be critical for the next several years because of the pandemic and the economic crisis. So that's something that we are looking at very carefully."

"I am also guided by the critical areas that we talked about during the campaign. So that's what we are prioritizing. Of course, it's the economy, prices, it's the price of energy, lack of jobs, education, infrastructure," he added.

The new president will be sworn in on June 30.