The Philippines has strong growth prospects over the medium- to long-term due to a large degree to policies of the Aquino administration that have succeeded in leveling the playing field for foreign investors, a ranking official of Goldman Sachs said.
In a briefing late Tuesday, the investment banking giant’s vice chair, Carl Stern, pointed out that the country’s economic growth was poised to even surpass its peers in the so-called “Next 11” list of booming emerging markets published last year.
“Your growth prospects look quite good relative to the alternatives out there,” he told reporters during a one-day visit to Manila to meet the firm’s local clients. “The Philippines is certainly one of the fastest-growing economies.”
The Next 11 list was published by Goldman Sachs economist Jim O’Neill last year, citing Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, Philippines, Turkey, South Korea and Vietnam as the emerging market economies that would lead global growth in the 21st century.
O’Neill is the same economist who coined the term BRICs in 2003, representing the booming economies of Brazil, Russia, India and China.
“Among the Next 11, the growth forecast for the Philippines of 5, 6, 7 percent [gross domestic product growth] certainly ranks very favorably,” said Stern, who joined Goldman Sachs after serving as president and CEO of the Boston Consulting Group.
The visit of the high-ranking official of one of the biggest investment banks in the world represented an important milestone for the firm, which, until recently, has kept a relatively low profile in the Philippine financial market.
Stern said the growing emphasis on the Philippines was due, in part, to the economic difficulties being experienced by the advanced economies of the United States and western Europe.
“Investors go where there’s money to be made,” he said, referring to emerging markets in general and the Philippines in particular.
The Goldman Sachs vice chair acknowledged the fact that the Philippines has experienced several boom-and-bust cycles in the past, but expressed optimism that the current economic upswing being experienced was a unique event mainly because of the Aquino administration’s thrust at improving overall governance in the country.
“The job that your government has done in anti-corruption, among many things, is setting a more solid, predictable foundation for the kind of capitalism that we practice,” he said.