Some Filipinos abroad seem to have a mixed reaction of what has been happening back home. They think that the past nine years was a big waste and that the problems now of the new administration are quite daunting. Many feel that it will be a huge challenge for PNoy to overcome these problems.
I arrived in America the other day to attend a wedding in California. Nothing much has improved. Shops are still empty, compared to what you see in Asia. Americans are still losing jobs. Filipino-Americans are doing much better because many of them have not fallen into the “credit card mentality” and many of them have saved enough. Some Fil-Ams have moved back to the Philippines, especially those in the real estate industry, as I see no improvement in this sector moving forward. So much has been built and banks are just not lending foreigners anymore. Credit has tightened and banks will never go back to their old system because they have learned the hard way. I continue to share these thoughts with Pinoys in the Philippines, especially those who are skeptical of our progress and future under PNoy, so they can realize that we are in a better situation nowadays.
Asia is the place to be. China has now overtaken Japan. The Philippines surely will come close or be at par with the Thai and Indonesian economy within the next six years. While China is number one when it comes to export of durable goods, the Philippines is going to be the largest exporter of services, through OFWs and inland services such as BPOs and call centers. These sectors will definitely continue to be the driving force, as the Philippines will capture more outsourcing. USA is already outsourcing to our BPOs, as foreign companies want to reduce cost to be more competitive in the world.
The fear of a double-dip recession, which is largely possible, is pushing many companies in the US to actually prepare for this. There is no other way for American companies to weather the second storm except to prepare.
Even the local government has huge problems. I had the chance to talk to Fil-Am Mayor Mike Guingona. He is the mayor of Daly City in California. The city is losing revenues from property tax, since property prices have fallen and many Americans had to let go of their homes. Maintaining the same level of services is a challenge. Even the salaries of policemen, firemen and teachers are affected. I believe this could be America’s next big problem.
The huge budget deficits and a slowing economy can lead to an explosive situation. It will take a long time until America will be able to fix all these problems. These problems were results of years and years of abuse and excessive spending. The cost structure of America is just too high. One cannot just drastically cut costs, as people are used to a certain level of service. The level of unemployment cannot increase, as crime will also escalate.
The Philippines is in a perfect spot. The fundamentals have been laid out for us to dominate the BPO space. The FOREX rates, inflation and interest rates have been very solid. Real estate is booming and many corporate earnings have been posting high growth versus previous periods. Clearly, our stock market has anticipated the entry of foreign investors, despite the drop in the US stock market in the past weeks.
Meanwhile, the Philippines’ stock market has broken its historic high. The stocks of the company I work for, RFM Corporation, has hit two pesos in the stock market. Its low was 23 centavos just some months back. Even the Lopez’s company has jumped to five pesos from its low of one peso. Almost all companies listed in the PSE are doing very well in market values. The index has broken all time high of 3,800.
Rante Aquila, a good friend who has done well in the local stock market, likes what he sees in his charts and feels that the next years will be good for the local stock market. He shares my view about America and feels that the US stock market is due for a major correction sometime in the future or at best have a few spikes similar to what Japan is experiencing for the last 15 years or so.
Our country has a high level of business confidence, which increased to 44% in the second quarter, from 39% in the first quarter this year. Same with consumer confidence, reached 10% this second quarter, from 5% in the first quarter. I see that same level of confidence with foreign investors who are coming in. Opportunities abound everywhere you look. Those who love to complain and not ride on this good window of opportunities may just end in a far worse situation. Well, I guess, they would have all the more reasons to complain in the future.
PNoy’s style of leadership is giving us all this renewed confidence. I also give credit to former President GMA for her hard work in setting the foundations. The Philippines is right on track. PNoy is the best person to lead us at this time when moral reformation is needed. As majority of the Filipinos have put him in position, the more he would need all the help that everyone can give.
Like ducks, many people love to quack. But, I tell you, don’t quack too long because you will miss out on every opportunity, as the country’s negosyo climate has taken off.
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I just would also like to thank Butch Gamboa for his column this weekend entitled “Business on an upbeat”. Thank you for considering our efforts in Go Negosyo. We have indeed planted seeds and continue to do so. We do not plan to stop until we see the Philippines grow as an entrepreneurial nation. We also hope for many more Filipinos to join us in this movement.