DepDev: US-Venezuela crisis won’t hit PH economy

The United States–Venezuela conflict will not have any tangible effect on the Philippine economy, according to Department of Economy, Planning, and Development (DepDev) Secretary Arsenio Balisacan.

In a Monday morning press conference, Balisacan said the ongoing tensions between the two nations across the Pacific will not have a substantial impact on the Philippines.

“With respect to the impact of Venezuela there is hardly nothing,” Balisacan told reporters in a Palace briefing.

“I don't think there's going to be a perceptive effect on us,” he added. “As it is, our links —directly and indirectly— to Venezuela's economy [are] not strong.”

On Saturday (Sunday morning in Manila), Donald J. Trump said the United States would take over Venezuela, following what he described as a “successful” overnight military operation that led to the arrest of Venezuelan President Nicolás Maduro and his wife, Cilia Flores, in Caracas.

Maduro was brought to the United States to face various charges, including narco-terrorism conspiracy. The Venezuelan leader, however, denied the allegations, saying Washington was intent on taking control of his country’s oil reserves.

Oil prices fell on Monday following Maduro’s capture. According to Agence France-Presse, Brent crude declined 0.63 percent to $60.37 per barrel in early Asian trading, while West Texas Intermediate fell 0.70 percent to $56.92 per barrel. Trump said the United States would “run” Venezuela and tap its oil reserves, which are the world’s largest.

The Philippine Stock Exchange Index rose 0.48 percent on Monday, tracking the global decline in oil prices.

RCBC Chief Economist Michael Ricafort said the ongoing conflict has resulted in a “wait-and-see approach” on whether geopolitical risks could affect the Philippine economy, particularly inflation and oil imports.

“Venezuela is an oil producing country, at around 800,000 barrels per day or less than 1% of world oil output, and a member of OPEC; with relatively large oil reserves,” Ricafort said.

“The world also watches how other global powers react, such as China (biggest buyer of Venezuela’s oil, biggest creditor of Venezuela; also with investments in Venezuela), which condemned the U.S. military strikes on Venezuela; Russia; Iran; among others.”