By Leslie Venzon
PNA
An industry leader expects more foreign direct and portfolio investments pouring into the country in the face of the economic slowdown in the United States.
Philippine Exporters Confederation Inc. president Sergio Ortiz-Luis said investors would start looking for safer places to do business, including the Philippines.
“To certain degree, this crisis is bringing more investments in the BPOs (business process outsourcing). That’s one of the bright sides (of the US crisis) and hopefully, foreign direct investments and maybe even portfolio investments must start shifting in this area of the world rather in the US,†he noted.
To take advantage of this opportunity, Ortiz-Luis cited the need for the Philippines to improve its competitiveness, particularly infrastructure and in other areas where the country is perceived to be weak.
He said significant reforms have been already undertaken to simplify business procedures and expanding access to credit financing.
The significant growths generated by the booming BPO, along with other service export sectors, are expected to make up for lower revenues of merchandise exports resulting from reduced shipments to the US.
“Even with all these problems, the (projected) growth of 35 to 40 percent in the services sector will still be met,†Ortiz-Luis noted.
With this, he said, industry players are maintaining their growth projection of three to five percent for this year.
Ortiz-Luis said the impact of the US crisis was already factored in the growth forecast, adding that the US is no longer their big market.
Government data indicated that export earnings in July 2008 rose by 4.3 percent to $ 4.43 billion, although at a much lower rate compared to an 8.8-percent growth the previous month.
This brought receipts from merchandise exports during the first seven months of the year to $ 30 billion, up by 4.1 percent from last year’s.
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