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Change has come and investors are noticing

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From change is coming to change has come.

Indeed, the country had seen and felt the impact of the massive development projects by the Duterte administration over the past year particularly in the infrastructure sector as the ambitious trillion-pesos “Build, Build, Build” program continues to rile up and is projected by the country’s top economic managers to further push the Philippine’s economic growth.
Budget Secretary Benjamin Diokno once said the BBB program will usher the country to its “Golden Age of Infrastructure.”

This program, which seeks to accelerate infrastructure spending and development in the country, is seen to turnaround the Philippine’s so-called “Achilles heel.”

New Clark City

Among the key flagship projects under BBB is the development of the New Clark City in Pampanga. Through the Investment Relations Office of the Bangko Sentral ng Pilipinas, a site visit for regional bank analysts, portfolio strategists and economists was conducted recently to view developments as well as the ongoing construction there.

This visit was in line with the government’s aim to drum up awareness in regards to the BBB program. Bases Conversion and Development Authority (BCDA) president and CEO Vivencio Dizon welcomed the guests and together with the top executives from the private sector discussed the details of the plans and projects in the New Clark City.

“We are in exciting times. The Philippines is undergoing massive infrastructure transformation pushing the economy toward its next stage of development, and we are eager to take everyone onboard in this journey,” Dizon said.

New Clark City will be the country’s first smart, green and resilient city. It is expected to be a major alternative growth hub outside Metro Manila with a total area covering 9,450 hectares.

Phase1A of the smart city is 40 hectares of land space that is targeted for completion by September 2019. Phase 1A will house the National Government Administrative Center (NGAC) and a world-class Sports Complex. The NGAC will be the future site for government offices and a housing village for government workers.

Rahul Bajoria, director of Research from Barclays said their growth outlook for the country still remains positive and “did not fundamentally change,” despite the hiccups from the above-target inflation the past couple of months.

“We have been positive about the growth outlook of the Philippines for quite some time [and we’re] still forecasting for a 6.5 percent growth this year,” Bajoria told the reporters during the visit.

“I’ve been hearing about them for the last four or five years but I actually come down here and see it’s actually quite different from just reading about it in the newspapers,” Bajoria explained.

He is expecting the country’s gross domestic product (GDP) to further expand next year as the construction momentum peaks up with the projects that are getting contracted out.
“I guess the near-term challenges around inflation [and] currency volatility are likely to persist for some time in our opinion but I think as [what] Deputy Governor Diwa [said] yesterday, [he] made it pretty clear that the central bank is on top of the situation,” Bajoria said.

However, he added Barclays is “still a little bit cautious” to the currency market situation noting that external pressures still continue to have an impact.

But he explained these pressures are transitory issue, insisting the Philippines “does have very strong structural drivers of the current account financing in the form of remittances [and] BPO flows, which will probably be dominating once the building cycle is over.”

On inflation forecast, the Barclays research director is looking at 5.1 percent average for this year while expecting a 3.5 percent average for 2019.

Meanwhile, Katsuhiko Yasui, president of the SMBC Nikko Securities Limited, a Japanese investments company, said that he is “impressed with what the Philippines is doing” noting the infrastructure developments in particular.

Yasui furthered that with this visit, he is looking forward to urge and invite more Japanese investors to consider Philippines as a great investment opportunity.

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