Philippine economy entering ‘sweet spot’
Governor Amando Tetangco Jr. of the Bangko Sentral ng Pilipinas on Wednesday wooed foreign investors to do business in the Philippines, claiming that the country was to enter a sweet spot where enterprises could reap “demographic dividends” resulting from the rising proportion of young, consumption-driven workforce.
In a speech during an investment forum Wednesday, the BSP chief said the Philippines was set to follow the lead of neighbors like Malaysia and Thailand in experiencing the economic benefits of a significant proportion of working individuals who fuel consumption to the advantage of businesses.
Consumption is a key driver of economic growth for the Philippines, but Tetangco said the contributions of consumption would be even more pronounced in the next few years as more young and educated Filipinos enter the workforce.
“The ‘demographic window’ is that period in an economy’s history where a prominent portion of the population is of working age. These people have the purchasing power that can drive consumption, encourage investments, and thus accelerate growth of the economy,” Tetangco said before members of the business community, including representatives from foreign firms.
“We [the Philippines] will have reached that window by 2015,” the central bank governor stressed in his speech delivered during the forum, which was held in Makati City and organized by Euromoney, an international business publication.
Citing official statistics, Tetangco said the current average age of Filipinos was 22.2 years, indicating a significant portion of the country’s population with the capacity to improve household incomes and increase the economy’s overall productivity over the next few years.