GOOD NEWS: PH stock market, one of the best performing global markets in 2014

SIDE NOTE: Nakasakay ka na po ng eroplano 'di po ba? Na-experience mo na ba na madelay ang flight? Alam mo po bang may karapatan tayo bilang mga pasahero (ng Cebu Pacific, PAL, Air Philippines, Zest Air, at kahit na ano pa) na dapat ipaglaban? Compensation? Yes, meron din po. Read more here.

-----------------------------------------------------------------------------------------------------------------------------------
Investors and would-be-investors in the PH stock market must be excited to hear this great news! Confidence in the vibrant PH economy has not faded, to date!

The Philippine stock market landed number 7 on the list of the best performing global markets in 2014. It had an increase of 22.01%, with benchmark year-end-performance set at December 23, 2014; this means the PH stock exchange index's performance may be higher than what was recorded by CNN on the last trading day, December 29; that's around (22.01% + 0.62%) = a whooping 22.63%!The PH stock market even outpaced that of neighboring Indonesia's (20.24%) at number 9.

Image Courtesy: CNN

For the common tao, or in layman's term (well, also as how a non-Economics student like me understands haha), this only means that more investors are interested to pour their cash into public companies because they know these companies may be regional economic giants. Not only are they interested, but they are optimistic that the promising economic success story of the Philippines will steal the international spotlight soon. However, here's a caveat, the article only mentioned 74 big markets; the others have not been included in the list (there are more than 190 nations in the world!).

Leading the list of top performing international markets are Argentina (54.51%) and economic giant China (43.32%). It may be recalled that this year's most valuable tech startup is Xiaomi, a Chinese smartphone maker which overtook Samsung in terms of sales units (in some countries that Samsun formerly dominated) for the first time in years, valued at 45 billion USD.

The worst global markets with biggest losses in 2014 include those of Greece (-26.62%) and Russia (-44.9%) which made headlines this year for annexing Ukraine's region Crimea. It's believed that Russia's on a recession today as an effect of the collapse of the oil prices worldwide (due to increased US supplies) and the economic sanctions imposed by countries against the political and military struggles ongoing at the proximity of Russia's borders.

PH economy grows by 5.7 percent in 1st quarter

The Philippine economy grew at a slower pace in the first quarter of 2014. PH's gross domestic product (GDP) grew by 5.7 percent in the first three months of the year, much lower than the 6.4 percent median estimate of 20 analysts queried by Reuters.

The growth pace was even slower than the 6.5 percent year-on-year growth in the fourth quarter of 2013, and the annual 7.7 percent growth in the first quarter of 2013.

The Aquino government is aiming for 6.5 to 7.5 percent GDP growth this year. In 2013, the economy grew by 7.2 percent, Southeast Asia's fastest at that time.

PH 2013 1st quarter GDP growth fastest among Asian countries

The Philippines economic growth was fastest among Asian countries for the first quarter of 2013, the National Statistical Coordination Board (NSCB) announced Thursday.

NSCB revealed that the country’s gross domestic product (GDP) grew by 7.8 percent in the first quarter of 2013, faster than China (7.7 percent), Indonesia (6 percent), Thailand (5.3 percent), and Vietnam (4.9 percent), Secretary of Socioeconomic Planning of the Philippines Arsenio Balisacan said.

NSCB attributed the 7.8 percent increase in the gross domestic product (GDP) of the country to the strong performance of the manufacturing (9.7 percent), and construction (32.5 percent) sectors, as well as the increase in government and consumer spending. The services and agriculture sectors also contributed to the growth with 7 percent and 3.3 percent, respectively. Meanwhile, the mining and industry contracted by 17 percent.

This was the second fastest growth rate of the country since a quarter in 2010 (8.9 percent), Balisacan said.

Philippines economic growth likely to surpass target 5-6%

In an Interaksyon report, the National Economic and Development Authority (NEDA) said Monday that the full-year economic growth of the Philippines will likely exceed the government's target of 5-6%.

In the first half of the year, economic growth averaged 6.1% bulked up by remittance-led consumer spending and the services sector including the business process outsourcing (BPO) industry.

The second half of the year will possibly reach at least 6% as more Filipino consumers will engage into extravagant shopping spree and other social gatherings, speeding up domestic spending, in the gift-giving and reunion months fed up especially by the release of Christmas bonuses and extra-month pays. 

Last month, credit ratings firm Standard & Poor's hiked its growth forecast for the Philippines while it cut or retained the outlook of the other Asian economies.

Philippines economy more competitive

The Philippines did it again! 

The Philippines's economic competitiveness improved, as the country jumps 10 places  from no. 75 to 65 out of 144 countries in the World Economic Forum's 2012/2013 Global Competitiveness Report.

The Philippines is said to be one out of two countries to make a double-digit jump, a  twice-in-a-row 10-notch jump to be particular, in the last two years. This year, the country entered the upper 50 percent of the competitiveness rank. 

It can be recalled that the nation once entered the bottom 25 percent rank of economies - the least competitive ones.

Cooperation between the National Competitiveness Council and other government agencies led to improvements in 11 out of 12 pillars or factors that the report measures and compares.

These include government institutions, higher education and training, infrastructure, financial market development, technological readiness, macroeconomic environment,  goods market efficiency, labor market efficiency, market size, business sophistication, and innovation.

However, the country failed to gather pace in the areas of health and primary education where it lost 6 places to 98th.

15,000 businesses gave insights to this year's competitiveness survey, and out of these, 132 came from the Philippines. The country's great performance this year can be attributed to the increasing business confidence in the Philippines - a signal that the Philippines PNoy administration must be doing something right and efficient particularly in governance and implementation.

The announcement came after the Philippines registered a 6.1-percent increase in its Gross Domestic Product in the first half. The complete Global Competitiveness Report can be viewed below.

The Global Competitiveness Report 2012-2013

Economy Watch: Uneven growth in world services sector this May

LONDON — Service sector growth in major European and emerging Asian economies was uneven in May, surveys showed on Friday, with slowdowns in the euro zone and India but a strong upturn in Russia.

Purchasing managers indexes (PMIs), which measure the activities of thousands of companies around the world, showed growth in the euro zone's vast services sector sagged for the second month in a row.

While the surveys indicated a welcome easing of inflationary pressure in Europe, input prices surged in Russia and also in India, where the service sector expanded at its weakest pace in 20 months.

A confusing picture emerged from Friday's Chinese services PMIs. The private HSBC survey showed growth accelerating and input price growth hitting a six-month high, but a government survey showed slowing growth and price pressures abating.

On Wednesday, manufacturing PMIs had showed a broad-based cooling of growth in world factories, feeding fears that the world's main economic engines are cooling fast as richer countries cut orders.

"Putting the services and manufacturing readings together... I think the PMIs as a whole are sending a pretty clear signal that there's a slowing in growth taking place," said Malcolm Barr, economist at JPMorgan.

Overall, the PMIs suggested businesses are still feeling the disruption to supply lines caused by March's earthquake and tsunami in Japan, and the costs of the commodities boom earlier this year which are still filtering through emerging markets. US PMIs due later on Friday are expected to show a modest uptick in growth for the non-manufacturing sector, although the spotlight will be on non-farm payrolls that are expected to show a steep loss of momentum in the labor market.

Friday's Markit Eurozone Services PMI showed a fall in May to 56.0 from 56.7 in April, holding above the 50 mark that signifies growth for the 21st month.

It showed growing disparities between the euro zone's strong Franco-German economic core and debt-burdened strugglers like Spain, Ireland and Italy, whose service sectors edged closer to stagnation.

The euro zone economy's 0.8 percent quarter-on-quarter expansion estimated for the first three months could be as good as it gets for this year, said survey compiler Markit.

British service sector growth also slipped in May, although like the neighboring euro zone, there was an easing in the upturn of both input and output prices that will come as welcome news for central bankers.

Price pressures

No such easing was seen in the slowing Indian service sector, as input costs increased markedly despite a series of interest rate hikes aimed at stemming rampant price growth.

The HSBC Indian services PMI slipped sharply to 55.0 in May from 59.2 in April — a 20-month low.

"The easing momentum for business activity and new business is evidence that policy tightening and high inflation is filtering through to growth," said Leif Eskesen, chief economist for India & ASEAN at HSBC.

Russian service companies fared much better, with the PMI there hitting a 13-month high thanks to a faster increase in new contracts.

While input price inflation also rose, approaching recent highs seen at the start of the year, the Russian service sector looked in rude health.

"As opposed to manufacturing, the service sector surprised positively in May demonstrating broad-based growth in all sub-sectors and accelerating its expansion rate to above the long-term average," said Alexander Morozov, chief economist for Russia and CIS at HSBC.

In China, HSBC's services PMI showed a big jump to 54.3 last month from April's near record-low of 51.6, contrasting with muted gains seen in the manufacturing PMIs which have suffered from power shortages and thinning profit margins.

By contrast, the official government survey from the China Federation of Logistics and Purchasing showed a slight slowdown in May — to 61.9 from April's 62.5 — as well as easing inflation pressure.

"Both indices measuring input prices and service charge prices dropped last month. That is a good sign and may help reduce inflation pressures," said Cai Jin, a vice-president at the China Federation of Logistics and Purchasing.

-with reports from Reuters and GMANews.tv

MVP offers to buy MRT

MANILA, Philippines—Local infrastructure giant Metro Pacific Investments Corp. (MPIC) has offered to buy the government’s stake in the Metro Rail Transit (MRT) 3 train line traversing Epifanio de los Santos Avenue for $1.1 billion.

The amount will be enough to settle the government’s outstanding debt to MRT Corp. bond holders, MPIC said.

The acquisition will give the group, chaired by businessman Manuel V. Pangilinan, 100-percent ownership of the company that holds the right to operate and manage the train line until 2025.

In a letter to Finance Secretary Cesar Purisima and Transportation Secretary Jose de Jesus, MPIC offered to buy shares in MRT Corp. currently held by state-owned lenders Land Bank of the Philippines and Development Bank of the Philippines.

MPIC was earlier given control over a 29-percent stake in MRT Corp. by the block’s owner, Fil-Estate Corp. of businessman Robert John Sobrepeña.

MPIC said it planned to spend $300 million to increase the MRT’s capacity to 700,000 passengers a day from the current 350,000 a day.

The capacity expansion would be completed in two to three years, according to the proposal letter, a copy of which was obtained by the Inquirer.

MPIC said it was willing to accept a lower rate of return on its investment if it would acquire the MRT stake from the government. It added that it would not seek any government guarantee for the project.

MPIC, however, urged the government to extend the build-operate-transfer contract by another 15 years to 2040 to make it financially viable.

The government stands to save $150 million in annual subsidies if it accepted the proposal, the letter said.

The proposal was offered as an alternative to the way the government wanted to privatize the MRT, which was to bundle it with the Light Rail Transit (LRT) line 1 that runs from Baclaran in Pasay City to Roosevelt, Quezon City.

The letter said any company that would be awarded the contract for the two train lines would have to assume responsibility of the lines’ debt obligations totaling about $2.6 billion.

Any company that wins the contract for both lines would have to spend a lot of money before even starting to improve the train line’s facilities. The letter said this expense would then be passed on to the riding public, raising train fares to as much as P100 a ticket.

In an interview, Transportation Undersecretary for rail transport Glicerio Sicat said the government was looking at two methods of privatizing the MRT line.

The first was for the government to take over the train system, improve its operations and facilities before finally bidding out a contract for the train’s operations to private parties.

“However, this method will take a long time and will be very expensive,” Sicat said.

The second method, Sicat said, was to look for a private company willing to acquire the government’s stake in MRT. The government would not have to spend a single peso and pass on the responsibility to the private investors.

MPIC controls Hong Kong-based First Pacific Co. Ltd.’s interest in the Philippines, including investments in telecommunications, infrastructure, healthcare and power generation and distribution.

Source: Paolo Luis G. Montecillo, Philippine Daily Inquirer

PH economy at its fastest pace in 24 years

MANILA, Philippines—The Philippine economy grew at its fastest pace last year since the 1986 Edsa People Power Revolution, expanding 7.3 percent due to strong domestic demand fueled by the billions of dollars overseas Filipino workers sent home.

Government data showed gross domestic product (GDP)—the total value of goods and services produced in the country—rose a seasonally adjusted 3.0 percent in the final quarter of 2010, more than double market expectations and a turnaround of a third-quarter contraction.

The National Statistical Coordination Board (NSCB) said the strong performance of the Philippine economy—coming off growth of just 0.9 percent in 2009—was achieved on the back of the world recovery from the global financial crisis.

“The global economic recovery which resulted in record growth rates of foreign trade … contributed to an economic performance in 2010 that well surpassed the government’s target of 5.0 percent to 6.0 percent,” the NSCB said.

Also boosting growth were higher remittances from the millions of Filipinos working abroad and the extra money that was pumped into the economy by politicians who campaigned in the national and local elections held in the middle of last year.

“Remittances have been pretty healthy and that has really helped to support private consumption in the Philippines,” said HSBC economist Sherman Chan. Remittances from overseas Filipino workers are expected to top $20 billion this year.

The NSCB said industry delivered its best seasonally adjusted quarterly growth in at least 15 years, rising 6.7 percent in October to December from the previous three months, with food manufacturers and mining leading the way.

“This shows the economy is not losing steam yet. That is in large part due to accommodative monetary policy, which has helped to sustain investments even though the government is pursuing fiscal consolidation,” Chan said.

Strong growth from industry and recovery by the farm sector more than offset falling government spending, which fell an annual 7.6 percent in the quarter.

NSCB Secretary General Romulo Virola said the 7.3-percent full-year GDP expansion was the highest since 1986 when the dictator Ferdinand Marcos was toppled in the Edsa Revolution.

Growth by sector

Private sector investment in construction, machinery and equipment resulted in a robust 17-percent growth in gross domestic capital formation. This supported the healthy pace of growth in manufacturing and services, according to the NSCB.

Industry contributed 3.9 percentage points to total GDP growth on the back of brisk manufacturing, particularly electrical machinery, petroleum and coal products, and food—thanks to a strong pick-up in domestic demand and the rebound in external trade.

The services sector contributed 3.5 percentage points to GDP growth, boosted by the strong performance of trade and private services. This was complemented by flourishing domestic investment, robust expansion in business process outsourcing, hotels and restaurants, wholesale and retail trade, and import and export trade.

Due to fewer typhoons, the agriculture sector managed to grow 5.4 percent in the fourth quarter. “Only two typhoons hit the country compared to seven in the last quarter of 2009,” Socioeconomic Planning Secretary Cayetano Paderanga noted.

Nonetheless, full-year growth in agriculture, fishery and forestry was subdued due to the lingering effects of the El Niño weather phenomenon in the first half of 2010.

Inflation, interest rates

Robust domestic demand, and rising global food and fuel prices, however, are adding to concerns about inflation.

“We were expecting the central bank to hike rates by the second quarter. But given these strong growth numbers, I think there’s scope for the central bank to normalize its monetary policy as early as the first quarter,” said Euben Paracuelles, an economist at Nomura in Singapore.

The Philippines is one of only two countries in Southeast Asia—the other is Indonesia—not to have raised interest rates since the end of the global financial crisis. The policy rate has been at a record low of 4 percent since July 2009.

The Bangko Sentral ng Pilipinas (BSP), however, said inflation was manageable.

“Not necessarily inflationary because the economy has expanded, its absorptive capacity has grown,” BSP Deputy Governor Diwa Guinigundo said in a text message to reporters.

Inflation is expected to rise up to the third quarter before stabilizing toward 2012, the BSP said on Friday. Annual inflation was 3.0 percent in November and December, after hitting a one-year low of 2.8 percent in October.

Exciting prospects

“We are looking toward exciting growth prospects,” Guinigundo said.

Likewise brimming with optimism, Paderanga said “the 2010 economic performance bolsters confidence that the economy is on a path of strong recovery.”

Arsenio M. Balisacan, dean of the University of the Philippines School of Economics, agreed that the rate of economic expansion in 2010 could provide momentum for future growth. But he added the challenges were many.

“Government has to raise revenue to sustain support for infrastructure development, investment in the social sector, particularly education and health, and institution building,” Balisacan said.

John Forbes, an investment adviser with the local American Chamber of Commerce, said the promise of further political stability during President Benigno Aquino III’s six-year term offered hope for a sustained period of strong growth.

He cited Mr. Aquino’s anticorruption campaign, social welfare spending and multibillion-dollar infrastructure upgrade plans as factors the Philippines could finally start to match its dynamic Asian neighbors.

“The Philippines is an economy in the world’s fastest-growing region and it is surrounded by economies that have grown at very high rates for a very long period of time,” Forbes said.

He said average GDP growth for the Philippines had been below 5.0 percent for the past decade.

“What this figure (2010 GDP growth) demonstrates is the potential of the Philippine economy to grow almost twice as fast (as 5.0 percent),” he said. With reports from Agence France-Presse and Reuters

Source: Riza T. Olchondra, Philippine Daily Inquirer

Philippine stocks rise at start of 2011

With a high expectation for a gracious, saving year for equities, investors snapped up stocks leading to a New Year rise in Asian indexes, including that of the Philippine Stock Exchange (PSE) on Monday, this year's first trading day.

PSE's index rose up 14.07 points or 0.33 percent ending a good 4,215.21. The biggest gaining sector was the industrial sector, firming up with 2.54 percent. Value turnover was relatively low at 3.825 billion due to the holiday hangover.

Meanwhile, 79 advancers beat 54 decliners and 30 stocks remain unchanged.

In-demand stocks came from Manila Electric Co., Metro Pacific Investments Corp., Cyber Bay Corp., Aboitiz Power Corp., San Miguel Corp., Metropolitan Bank & Trust Co., SM Investments Corp., Nickel Asia Corp., Petron Corp., First Philippine Holdings Corp., Cebu Air Inc., San Miguel Corp. preferred shares and Megaworld Corp.

Dealers said investors hastily took up shares of Meralco and MPIC, the two most actively traded stocks for this day, on expectations that the First Pacific group could extract more values out of Meralco.

The decliners include Alliance Global Group Inc., DMCI Holdings Inc., Atlas Consolidated Mining & Development Corp., Energy Development Corp., Philippine Long Distance Telephone Co., Philex Mining Corp. and Ayala Land Inc.

RP Economy at Record High 7.3%

Arroyo's presidency has bear fruits, bringing in an economic pouring of 7.3% in its national growth from outrageous election spending, an okay-rise in remittances from abroad, and improved business and consumer confidence.

Both the GDP and GNP of the country outpaced expectations.

Augusto Santos, director general of NEDA, stated that “the improvement in the global economy, brighter economic outlook, increased business and consumer confidence, and election-related spending all contributed to the resurgence in economic activities."

The industrial sector, which embraces the fields of manufacturing, utilities, mining and quarrying, grew 15.7% during the first quarter, way better than last year's contraction of 2.6%. The services sector, which includes the growing business process outsourcing sub-sector, also increased to 6.1% in the first quarter. However, the agriculture, forestry and fisheries sector was hit largely due to the dry spell, contracting at 2.5%.

Santos suggested that to prevent stagnant growth or probable decline, the government has to increase spending on infrastructure, social services and education.

For more information, click on this link.