Philippine Economy Talk

[jut703]

Bdo is offering RTB *1.9% quarterly payout lower than previous 3-4%

Sent from my SM-N910C using Tsikot Forums mobile app

Talo pa ng CIMB/ING na savings account [emoji23]


Sent from my iPhone using Tapatalk

[kagalingan]

tsikoteers,

umulan buong araw lalo nawalan customer mga al fresco dining. (bale dati na sila alfresco kasi ihawan style.

Pag walang-ulan konti na customer eh lalo pa kanina.

[Ry_Tower]

After 28 years, Mandaluyong hotel Legend Villas announces closure

Deym, too many memories there for me hehe.

Sent from my SM-N960F using Tsikot Forums mobile app

[Flipo]

Losing to Vietnam | Philstar.com

Losing to Vietnam
DEMAND AND SUPPLY - Boo Chanco (The Philippine Star) - February 10, 2021 - 12:00am

There had been a lot of talk about charter change to remove provisions that supposedly discourage foreign investors from pouring capital here. I agree that is a factor why we are unable to attract as much foreign direct investments (FDI) compared to regional peers like Vietnam.

But let us be clear that even if that chacha happens, it will not solve our attractiveness problem. We have to address among others, our corrupt political system and the horrible bureaucracy that thrives on red tape.

We are a nation with a surplus of lawyers, but a weak judiciary… and a useless Congress that robs the Treasury through pork barrel, protects vested interests, and mindlessly passes laws that only make life and doing business here increasingly unbearable.

I have been reviewing comparisons of the Philippines and Vietnam prepared by the local foreign chambers of commerce. Vietnam scores high in many items considered important by current investors: intelligent COVID response, power supply/rate, broadband speed, ICT adoption, enforcing contracts, labor hiring and firing practices, FDI restrictiveness, murder rate, overall security, paid holidays, policy stability, etc.

But our situation is not a total disaster. Indeed, our current foreign investors admit Vietnam has no inherent advantage that the Philippines cannot equal. Of course, that requires a president who knows what he is doing and the political will to get things done beyond press releases. So there…

The new CREATE could be a turning point for doing better. We have known for a while that we are slipping behind. We know what needs to be done. But we are just too slow and indecisive. It took a Sonny Dominguez to stubbornly insist reforms are needed and must be passed into law.

“The fact Vietnam is moving ahead should be a wake-up moment for the Philippines to do more and faster to grow and create jobs,” one foreign chamber official here observed.

“Asia is the fast-growing region in the world and will remain so. There is lots of FDI, to spread around, and the Philippines can attract much, much more, as much as Vietnam, but this requires working harder at it, and Vietnam is a tough competitor.”

Here are some points of comparison my foreign chamber source shared with me:

Labor force – We have better managerial talent and better worker skills and the workforce sizes are comparable. Indeed, our managers are well regarded in Vietnam.

I visited a vast tourism complex of hotels, restaurants and a fleet of small cruise ships that take visitors on overnight trips around Halong Bay. Their top manager is a Filipino from Angeles City. A good number of their staff are Filipino too.

When Intel left their factory in Cavite to relocate to Vietnam, they took some of their Filipino managers and engineers to help run the new plant. There is a thriving community of OFWs who are managers and professionals in Vietnam.

In an Amcham Singapore survey in 2018, the Philippines beat Vietnam 74 to 49 percent in terms of a favorable rating for availability of trained manpower. But even this advantage is to no avail because of our highly politicized business climate. Our trained manpower ends up helping other economies grow instead.

This manpower advantage has also probably dissipated by now. Surveys now show Vietnamese students beat Filipino students in science and math. We still have some advantage for English proficiency, but probably not for long.

The Vietnamese government had been seriously training their people to supply the requirements of investors. We, on the other hand, only pretend to train our workers.

Governance - both countries have corruption; the Philippines should have less because open media is a check, while there is state censorship in Vietnam. But countering that is the weak rule of law in the Philippines.

In Vietnam like China, there are periodic anti-corruption campaigns, and the big guys are punished. Here the big guys - and gals – get away with their crimes.

Erap was the highest official found guilty of corruption by the Sandiganbayan. But he was quickly pardoned by former President Arroyo and was even able to run again for president the next election and almost won.

My source also pointed out that “Vietnam has the mandarin tradition where the native bureaucracy would govern responsibly with governance focused on popular welfare. The Philippines lacks this, even at a national level…

“Our politicians monopolize local businesses, indulge in patronage practices and buy votes if such patron-peasant assistance is not enough.”

Policy implementation – “Take agriculture. Why does Vietnam do so well with cashews, coffee, rice, fish, and more? It is not foreign investment in this sector. The government is better organized to assist the farmers to be productive.”

I have wondered about that too. Landers superstore is selling cashews from Vietnam. Why aren’t there cashews from Antipolo instead? How their government treats agriculture is probably the important advantage.

Our government has neglected our agricultural sector and even milked whatever meagre budget it gets for personal gains of officials. Remember the fertilizer scam scandal of the Arroyo administration?

We also do not have enough infrastructure to support agriculture from irrigation, credit facilities, to technical support for farmers.

And as we have seen in the current African Swine Fever epidemic, our government was late to react and didn’t have the testing and quarantine strategy to save our swine industry. Now they are clinging to price control, another disaster in the making.

Yet, Vietnam’s situation wasn’t so different from ours as they emerged from the Vietnam war. My source told me that after their 1975 victory over America, they expelled Chinese middlemen. They also learned from Mao’s Great Leap Forward that caused famine and poverty in China’s countryside.

“Their own quick realization and correction of their agrarian policy enabled them to incentivize farmers to produce more. The Vietnamese government has clearly made their farmers prosperous unlike in the Philippines.”

Here we are, still debating about agrarian reform even when it is clear we ought to consider it a lost cause and do what we must to get farmers out of poverty like Vietnam. Next Friday, we will discuss other areas of competitiveness.

[uls]

watching GMA news

the word stagflation is mentioned

media finally catches up

the word STAGFLATION

economic stagnation with rising inflation

[Flipo]

Vietnam overtakes us (Part 2) | Philstar.com

Vietnam overtakes us (Part 2)
DEMAND AND SUPPLY - Boo Chanco (The Philippine Star) - February 12, 2021 - 12:00am

Every two decades or so, an ASEAN economy’s GDP per capita moves ahead of the Philippines.

In 1983, Thailand surpassed the Philippines $824 to our $743. In 2003, Indonesia overtook the Philippines $1,186 to our $1,063. Last year, 2020, Vietnam was set to surpass the Philippines, $3,498 to our $3,373. Which country will overtake us next?

I got this e-mail from Ambassador Benedicto V. Yujuico, president of the Philippine Chamber of Commerce and Industry, reacting to my last column.

“I agree that the Philippines can and must do much better than Vietnam (and other ASEAN countries). It is regrettable that our country has competitive advantages that are way underutilized.

“In 2011, I was invited by the Vietnam Chamber of Commerce and Industry to visit the nascent Ho Chi Minh Stock Exchange and factories. Today, Vietnam’s stock exchange is larger than the PSE. The same regrettable situation has happened in many other production facilities as well.

“In order for our country to achieve ‘Ambisyon 2040’ – when the Philippines is no longer poor and all Filipinos can enjoy a good life – many things need to change now. Otherwise, when 2040 comes, some clever pundit will suggest changing 2040 to 2060.”

There are many reasons why we are eating Vietnam’s dust. Bad politics nurtured by blood sucking politicians is a major reason. Vested interest groups insisting on economic protectionism. No sense of nationhood and the common good among us.

Here we are now, being overtaken by a badly war-torn Vietnam and not too many of our leaders or people are the least bit concerned. Our failure, while rooted in the Marcos years and earlier, mostly happened post-EDSA.

We continue the second part of our exposition on how Vietnam is beating us in attracting foreign investments and moving people out of poverty.

Business costs – The Vietnamese economy opened with labor dirt cheap, but wages have increased, and today JETRO statistics show manufacturing wages are the same in the Philippines and in Vietnam.

However, most other costs for manufacturing are lower in Vietnam. If you are an exporter, every cent counts to be competitive. It helps Vietnam that it has lower power costs and less paid holidays.

“The fiesta-loving Filipinos celebrate twice as many non-working holidays (NWH) than their Vietnamese counterparts. Philippine employers shut their factories for religious holidays of Christians, Muslims,” an exasperated foreign investor in Manila commented.

The Koreans are the number one investors in Vietnam, led by Samsung. But Koreans are also big in garments and footwear. Here is a Manila-based foreign chamber official’s observation:

“Look at the Nike website which has a great map showing the countries where its products are made. Vietnam is the favorite with 500,000 Vietnamese workers in over 100 factories. Nike designs and sells, but does not manufacture.

“Are there 500,000 Filipinos who could make Nike products? Of course, but the government has become dependent on remittances and has passively accepted the destruction of a garment and footwear export industry from one million workers to 250,000. The last factory making products for Nike in the Philippines closed some time ago and relocated to Vietnam.

“The Filipino-owned exporter firms quit because they could not make money (labor and logistics costs too high, red tape and corruption made it more profitable to invest in treasury notes).”

Export costs and port reliability – Ho Chi Minh City last year reached the Holy Grail of container shipment costs when the first of the class of largest container ships began to service the new port.

Such a ship can sail directly to the US West Coast, while a container shipped from Manila to Long Beach has to be transshipped, thus costing more and taking longer. The Philippines does not have the volume of exports to justify a port call at Manila.

“Also, periods of port congestion in Manila have created concerns for Philippine-based exporters whose products have to reach foreign markets on time. The logistics chain does not tolerate delays.

“Yet Manila imposes truck bans, thus reducing the efficiency of truck prime movers that then charge more because they can only make fewer movements daily.

“Or Manila suffers from a huge excess of empty containers because imports exceed exports. The containers are no longer clogging the port, but when the owners have to export them empty, it adds to higher costs for Philippine logistics.

“And keep in mind that imports contain the raw materials for exports because of the lack of adequate local production. Thus, imports and exports can be delayed, making the Philippines less attractive.

“This is why Ford, the last auto assembly firm to export, closed. It tried its factory for 10 years in Laguna, expecting the local auto parts firms to meet more of its requirements. They didn’t, so Ford closed.

“Ford did not shift to Vietnam, but to Thailand, which has created a massive cluster with 4,000 auto industry locators producing two million vehicles a year.

“The Philippines has achieved this for BPOs because of English, a sector where Vietnam does not compete. But Vietnam has better software engineers than the Philippines.”

Trade access – Vietnamese leaders have a foreign market vision, Philippine leaders less so. Vietnam observed how Japan, Korea, Taiwan, China, and others have progressed through exports and decided the quickest way was to invite foreign companies to locate.

Vietnam successfully negotiated an EU-VN FTA. So now Hanoi can tell an investor to locate in Vietnam because it can access the TPP members and the EU, plus all ASEAN and the countries with agreements with ASEAN (India, China, Korea, etc.).

“Phl-EU talks are suspended because Brussels legislators have deep human rights concerns from the Duterte drug war and political pressures on the media.”

Vietnam is more open to FDIs. The OECD rating of openness shows Vietnam near the OECD average. The Philippines was the most restricted (in 2018).

Indonesia, which in the OECD rankings is just next to the Philippines, is rapidly opening restricted sectors and attracting more FDIs, including manufacturing firms not wanting to be in China only.

In summary, we are a mess… and we know it, but we seem content in our puddle. Pity our younger generations as the country’s economy continues to sink.

[dr. d]

some might pooh pooh it, saying it is only how some see it but is not really the entire picture,
but if this is how the investor sees it,
it does not matter how the pooh pooh-er wants them to see it.

[uls]

Vietnam overtakes us (Part 2) | Philstar.com

Vietnam overtakes us (Part 2)
DEMAND AND SUPPLY - Boo Chanco (The Philippine Star) - February 12, 2021 - 12:00am

Every two decades or so, an ASEAN economy’s GDP per capita moves ahead of the Philippines.

In 1983, Thailand surpassed the Philippines $824 to our $743. In 2003, Indonesia overtook the Philippines $1,186 to our $1,063. Last year, 2020, Vietnam was set to surpass the Philippines, $3,498 to our $3,373. Which country will overtake us next?

I got this e-mail from Ambassador Benedicto V. Yujuico, president of the Philippine Chamber of Commerce and Industry, reacting to my last column.

“I agree that the Philippines can and must do much better than Vietnam (and other ASEAN countries). It is regrettable that our country has competitive advantages that are way underutilized.

“In 2011, I was invited by the Vietnam Chamber of Commerce and Industry to visit the nascent Ho Chi Minh Stock Exchange and factories. Today, Vietnam’s stock exchange is larger than the PSE. The same regrettable situation has happened in many other production facilities as well.

“In order for our country to achieve ‘Ambisyon 2040’ – when the Philippines is no longer poor and all Filipinos can enjoy a good life – many things need to change now. Otherwise, when 2040 comes, some clever pundit will suggest changing 2040 to 2060.”

There are many reasons why we are eating Vietnam’s dust. Bad politics nurtured by blood sucking politicians is a major reason. Vested interest groups insisting on economic protectionism. No sense of nationhood and the common good among us.

Here we are now, being overtaken by a badly war-torn Vietnam and not too many of our leaders or people are the least bit concerned. Our failure, while rooted in the Marcos years and earlier, mostly happened post-EDSA.

We continue the second part of our exposition on how Vietnam is beating us in attracting foreign investments and moving people out of poverty.

Business costs – The Vietnamese economy opened with labor dirt cheap, but wages have increased, and today JETRO statistics show manufacturing wages are the same in the Philippines and in Vietnam.

However, most other costs for manufacturing are lower in Vietnam. If you are an exporter, every cent counts to be competitive. It helps Vietnam that it has lower power costs and less paid holidays.

“The fiesta-loving Filipinos celebrate twice as many non-working holidays (NWH) than their Vietnamese counterparts. Philippine employers shut their factories for religious holidays of Christians, Muslims,” an exasperated foreign investor in Manila commented.

The Koreans are the number one investors in Vietnam, led by Samsung. But Koreans are also big in garments and footwear. Here is a Manila-based foreign chamber official’s observation:

“Look at the Nike website which has a great map showing the countries where its products are made. Vietnam is the favorite with 500,000 Vietnamese workers in over 100 factories. Nike designs and sells, but does not manufacture.

“Are there 500,000 Filipinos who could make Nike products? Of course, but the government has become dependent on remittances and has passively accepted the destruction of a garment and footwear export industry from one million workers to 250,000. The last factory making products for Nike in the Philippines closed some time ago and relocated to Vietnam.

“The Filipino-owned exporter firms quit because they could not make money (labor and logistics costs too high, red tape and corruption made it more profitable to invest in treasury notes).”

Export costs and port reliability – Ho Chi Minh City last year reached the Holy Grail of container shipment costs when the first of the class of largest container ships began to service the new port.

Such a ship can sail directly to the US West Coast, while a container shipped from Manila to Long Beach has to be transshipped, thus costing more and taking longer. The Philippines does not have the volume of exports to justify a port call at Manila.

“Also, periods of port congestion in Manila have created concerns for Philippine-based exporters whose products have to reach foreign markets on time. The logistics chain does not tolerate delays.

“Yet Manila imposes truck bans, thus reducing the efficiency of truck prime movers that then charge more because they can only make fewer movements daily.

“Or Manila suffers from a huge excess of empty containers because imports exceed exports. The containers are no longer clogging the port, but when the owners have to export them empty, it adds to higher costs for Philippine logistics.

“And keep in mind that imports contain the raw materials for exports because of the lack of adequate local production. Thus, imports and exports can be delayed, making the Philippines less attractive.

“This is why Ford, the last auto assembly firm to export, closed. It tried its factory for 10 years in Laguna, expecting the local auto parts firms to meet more of its requirements. They didn’t, so Ford closed.

“Ford did not shift to Vietnam, but to Thailand, which has created a massive cluster with 4,000 auto industry locators producing two million vehicles a year.

“The Philippines has achieved this for BPOs because of English, a sector where Vietnam does not compete. But Vietnam has better software engineers than the Philippines.”

Trade access – Vietnamese leaders have a foreign market vision, Philippine leaders less so. Vietnam observed how Japan, Korea, Taiwan, China, and others have progressed through exports and decided the quickest way was to invite foreign companies to locate.

Vietnam successfully negotiated an EU-VN FTA. So now Hanoi can tell an investor to locate in Vietnam because it can access the TPP members and the EU, plus all ASEAN and the countries with agreements with ASEAN (India, China, Korea, etc.).

“Phl-EU talks are suspended because Brussels legislators have deep human rights concerns from the Duterte drug war and political pressures on the media.”

Vietnam is more open to FDIs. The OECD rating of openness shows Vietnam near the OECD average. The Philippines was the most restricted (in 2018).

Indonesia, which in the OECD rankings is just next to the Philippines, is rapidly opening restricted sectors and attracting more FDIs, including manufacturing firms not wanting to be in China only.

In summary, we are a mess… and we know it, but we seem content in our puddle. Pity our younger generations as the country’s economy continues to sink.

1 -- more than 10 yrs ago sinabi ko dito sa forum mas madali mag import kesa mag manufacture sa Pinas... yan parin sinasabi ko walang pagbabago

2 -- BPO and OFW talaga ang dollar earner ng Pinas... huwag na umasa sa manufactured goods exports... di tayo competitive

[baludoy]

i guess the rumors my davao city based friends have been hearing lately re his liquidity are true .


Dennis Uy open to selling Phoenix Petroleum | Inquirer Business

[teukie]

Time to buy???

Sent using Nokia 5110 v2021