THE 23rd World Economic Forum on East Asia (WEF-EA) opened last Wednesday with about 600 delegates from 30 nations who gathered in Manila to discuss regional issues, such as political stability and infrastructure investment.
It was the first time that Manila hosted the international event.
The WEF was established in 1971 and is headquartered in Geneva, Switzerland. It is an independent and impartial body that works closely with major international organizations to fulfill its commitment to improving the state of the world through public-private cooperation.
In his toast at the WEF-EA welcome dinner on May 22, President Aquino said the gathering “takes place in the context of an increasingly prominent Asean [Association of Southeast Asian Nations] and the comeback of the Philippines.”
The region has been enjoying mostly robust economic growth, particularly the Philippines. Its economy expanded by 6.8 percent in 2012 and 7.2 percent in 2013, despite the challenges presented by natural disasters, making it one of Asia’s fastest-growing economies.
President Aquino said in his speech that the WEF-EA provided a chance to “continue the conversation” on how to “foster inclusive and sustainable growth together, in overcoming whatever uncertainties and challenges the future may bring.”
The countries making up the Asean, which are populated by some 600 million people, have a strong potential for bigger economic growth.
The International Monetary Fund has forecast the economies of Asean members Thailand, Indonesia, the Philippines, Vietnam and Malaysia to expand by an average of 4.9 percent in 2014 and 5.4 percent in 2015. This expansion will be led by the Philippines, which is expected to grow 6.5 percent this year and in 2015.
Growth will be spurred by the Asean integration, which will begin in 2015. This integration will transform the region into an economic bloc that can attract investments that, in turn, will lead to the creation of jobs and an increase in incomes.
The integration of Asean members into an economic community should also result in simplified rules and lower costs for doing business.
WEF-EA delegates agreed that good governance was a crucial component, along with peace and political stability, to ensure the region’s continued economic vibrancy through structural reforms and policies that combat corruption, reduce or eliminate red tape, and provide ease in doing business.
Many third parties are particularly optimistic about the Philippines’s economic future. Earlier this month Standard & Poor’s upgraded by one notch its investment-grade rating for the country, while Moody’s Investors Services and Fitch Ratings are expected by the Bangko Sentral ng Pilipinas (BSP) to follow suit in the near future.
Moreover, leading think tank IHS put the Philippines’s capacity for long-term economic growth at 4.5 percent to 5 percent annually between 2016 and 2030.
In a statement last week, Rajiv Biswas, Asia-Pacific chief economist at IHS, said this will “transform” the Philippine economy from its current $280 billion into a “$680-billion economy by 2024, with a projected gross domestic product [GDP] of $1.2 trillion by 2030.”
This impressive economic growth will be supported by earnings from the business-process outsourcing (BPO) industry and remittances from overseas Filipino workers.
In 2013 the BPO sector earned about $13.3 billion and is expected by the BSP to grow by 15 percent this year. Remittances reached $25 billion last year.
Biswas also said total GDP per Filipino will increase to $5,800 from about $2,800 this year, a phenomenon that will have “considerable implications for the size of the Philippine consumer economy,” in that these “significant increases in per-capita GDP will create one of the Asean’s largest consumer markets of the future, as the middle class rapidly expands over time.”
Echoing the findings of the WEF delegates, Biswas said that, to sustain its economic momentum, the Philippines has to improve its business climate to attract investments in tourism and manufacturing, both identified by many analysts as key sectors for growth.
In his speech at the WEF-EA plenary on May 22, President Aquino reiterated his administration’s commitment to good governance, reforms, social programs and infrastructure improvement, among other things.
According to him, all these have one end in mind: inclusive growth.
“At the end of the day,” the President said, “we recognize that the power behind all our efforts…comes not from any individual, but from our people.”
And it is as a people working together that we shall learn the lessons from WEF-EA; take advantage of the opportunities of Asean integration; face the challenges that will arise; and sustain the momentum of our vibrant economy by continuing to walk on the straight path.
Congratulations to President Aquino and all those involved in Manila’s successful hosting of the 23rd WEF-EA! –Atty. Jose Ferdinand M. Rojas II / Rising Sun, BUsinessmirror
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