BUSINESS MIRROR - August 25, 2009

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Bankers say RP on upside of recovery

A HONG Kong-based Filipino banker said the pace of the Philippines’ economic recovery is on track, since it is one of three countries not directly affected by the collapse of the global financial system.

“The Philippine economy never quite got into the ‘V’- or ‘U’-shaped pattern that clutched the countries directly hit by the crisis,” Eli Remolona of the Bank for International Settlements (BIS) said on Monday.

Remolona, BIS chief representative, spoke to reporters after receiving an award from Bank of the Philippine Islands (BPI) as one of three highly exceptional Filipinos overseas.

He explained that the global economy is on a “U”-shaped pattern of recovery after the United States’ housing industry collapsed from unsecured debts and rolled over outside its borders.

Remolona said, however, the recovery on the right side of the “U” is flatter, signaling weakness.

“The Philippines is on the good part of the upside of this ‘U’,” he noted, citing that the country was affected only because of ROP bonds. “But this is also marginal.”

BPI executive Raul Dimayuga agreed, saying he sees the recovery more of the shape of a hockey stick, with recovery slow and may take a longer time.

Dimayuga, BPI overseas banking and channel services group senior vice president, said continuous remittance of overseas Filipino workers would ensure that the Philippines remain on track with its recovery.

The National Economic and Development Authority has stuck to its forecast growth range of 0.8 percent to 1.8 percent in the country’s gross domestic product for this year.

However, low consumer spending remains an uneasy factor shadowing chances of the economy hitting this target.

“But we’re resilient as a people and as a nation. Despite the hardships, we have this ability to take everything in stride,” Remolona said.

He noted, however, that the shifts in leadership positions next year may affect the pace of recovery.

Remolona is one of the 2009 BPInoy awardees, recognized for his outstanding achievements in the field of banking and economics.