Business groups hoping for an economic rebound in 2024

With the Philippines’ overall inflation rate further decelerating to 3.9 percent in December last year and many financial institutions holding on to the possibility of rate cuts happening this year, many business groups are looking to a better 2024.

The president of the Philippine Chamber of Commerce and Industry (PCCI), the country’s largest business organization, is facing the year with an optimistic view, hoping that joint initiatives from the public and private sector to improve the business environment will yield fruit this year.

“The government efforts and the private sector efforts to address the issue of the ease of doing business, with all the promotions and with all the incentives being given to foreign investors, we [are looking forward] to a better year for 2024,” says Enunina Mangio, president of PCCI.

Enunina Mangio

The newly elected head of PCCI also expresses optimism that the Philippines’ gross domestic product will grow by 6.5 percent to 7.5 percent this year.

Mangio believes this will be driven by domestic consumption and an increase in government spending.

Improvement in export volume

Two local export-oriented groups share the same view for 2024, hoping that their industry’s export volume will improve, albeit slower than the target originally set.

George Barcelon, chair of Philippine Exporters Confederation Inc., says they expect a 5 percent to 6 percent growth in export volume for the whole of 2024 against a backdrop of slowing inflation.

George Barcelon

“We are talking to some of the exporters, they are hopeful. Probably, if we can get a midpoint of 5 to 6 percent increase, I think it would be good,” Barcelon says in a statement.

“One of the key exports, in electronics, they (industry players) are expanding,” he adds.

Robert Young, president of Foreign Buyers Association of the Philippines, whose trade group exports about $1 billion worth of garments annually, sees a “modest” growth for their products.

Robert Young

He earlier said garments, textile and apparel exports were projected to grow by 2 percent to around $1.33 billion, with the expansion starting in the middle of the year as industry players penetrate new overseas markets.

“Now, we believe the economy is slowly recovering in some parts of the world. However, not as fast, this may take till the third quarter before we reap some kind of improvements,” he says. South America and the Middle East could be new markets for the group, he adds.

Total external trade in goods amounted to $67.03 billion as of November 2023, marking an annual decline of 13.7 percent.

Service export revenues from January to September 2023, meanwhile, saw an annual increase of 20.7 percent to $34.7 billion.

Employment expansion

Joblessness in the Philippines hit 3.6 percent as of November, translating to 1.83 million Filipinos who were either jobless or out of business, according to the government’s latest nationwide survey of 11,233 households.

Sergio Ortiz-Luiz Jr.

Sergio Ortiz-Luis Jr., president of Employers Confederation of the Philippines, says they are hoping to create over a million new jobs this year, which, if successful, would cut down the unemployment rate by nearly half.

“[These will] mostly [be] in the service sector. Also, in IT (information technology), manufacturing, and construction,” Ortiz-Luis says.

The business group has dubbed this job creation initiative as “Project Jobs,” which would be done with the support of the SM Group, one of the largest employers in the Philippines.

Retail rebound

With the impact of the pandemic subsiding and the return to in-person shopping and traveling returning to normal, local retailers are also upbeat for a rebound.

Roberto Claudio

Roberto Claudio, president of Philippine Retailers Association, says they see a 5 percent to 10 percent growth in gross revenues.

“Last Christmas season, we saw a 20 percent to 25 percent top line growth, which means people are already going out and buying. The top line is an indicator whether people are going out to shop or otherwise,” Claudio says.

“We also expect more foreign tourists to come, not only for vacation, but also to shop. We also expect that the value added tax refund for foreign tourists shopping here will be passed by Congress already,” he adds.

Over 5.45 million foreign tourists visited the country in 2023, according to the Department of Tourism.