MANILA, Philippines -- The global economic crisis has hit home in 2008, but the worst -- more factory closures and layoffs, lower job opportunities and investments -- is yet to come, former budget secretary Benjamin Diokno has warned.
"It is not true that the economic storm is coming. It has arrived. It is true, however, that the worst is yet to come. The Philippine economy is expected to grow at a slower 3.0 percent in 2009,'' he said in his presentation "The Philippine Economy: The Worst is yet to Come," which he e-mailed to the Philippine Daily Inquirer.
The sharp slowdown of the Philippine economy from 7.3 percent in 2007 to about 4.0 percent to 4.5 percent in 2008 was largely due to the crisis, the University of the Philippines (UP) economics professor said.
He was to deliver this presentation in a forum at the UP School of Economics Wednesday afternoon.
Apart from slower exports, Diokno forecast more factory shutdowns and layoffs, higher unemployment here and overseas, lower foreign direct investments and lower job opportunities in 2009.
He said that exports growth from January to October in 2008 slowed to 1.9 percent, a far cry from the original growth target of 11 percent.
"The downward trajectory is alarming. October 2008 exports contracted by 14.9 percent to $3.97 billion from $4.7 billion in October 2007, the weakest monthly export performance since Dec 2001,'' he said.
The professor said the exports sector in the country was "expected to worsen'' this year as the economies of the top 10 destinations of Philippine exports were "projected to worsen.''
"The recovery in 2010 is expected to be weak,'' he said.
The top 10 markets of Philippine exports are the United States, Japan, China, Hong Kong, The Netherlands, Germany, South Korea, Taiwan, Malaysia and Singapore.
And weaker economies in these markets would translate to lower demand for Philippine products, which meant more factory closures and layoffs, Diokno said.
"Joblessness -- at home and abroad -- will worsen. With its fast growing population, the Philippine economy should create some 1.0 to 1.5 million new jobs every year,'' he said.
