Duterte discounts’ affecting PH economy

  • Page Views 741
  • The Philippines is suffering from a presidential discount. Local equities have delivered poor returns during the first year in office of  President  Duterte. That suggests little positive regard for the hard-nosed leader’s solid economic agenda.

    The country is in strong financial shape. Despite a bit of a slowdown in the first quarter, the World Bank forecasts annual economic growth of almost 7 percent this year and next, consumer confidence among the young population has hit an all-time high, and government debt relative to GDP is the lowest in three decades.

    Duterte’s plan to boost infrastructure spending and to cut income tax offers further reasons to be optimistic. Building more roads and airports should help the sprawling local listed conglomerates. And putting more money into citizens pockets, will benefit fast moving consumer goods players. Robust popular support also means there is a high chance Duterte can push through his planned overhaul.

    Yet, those who invested when Duterte took office on June 30, 2016, have been stung. The peso has fallen more than 7 percent against the dollar during the president’s tenure and total shareholder returns from the MSCI Philippines have been virtually flat.

    Both indicators have lagged the comparable performance for major Southeast Asian peers.

    True, Philippine stocks are already similarly priced to regional peers. The latest comparable data from IBES indices on Thomson Reuters shows local equities trade on a forward price to earnings multiple of 16.9 times, compared to 16.1 times for Indonesia and 14.7 times for Thailand. But the Philippines is growing much faster than these countries. India has a comparable growth rate and its stocks command a multiple of 18.2 times.

    Of course, it is hard to focus on the broad economic prospects and real reforms when Duterte is pressing on with his controversial bloody war on drugs and martial law has been declared in a southern province of the country amid an insurgency by militants linked to the Islamic State. As long as there are such messy distractions, the Philippines will wait for a premium.

    BY Reuters , Malaya

    Share

    New Posts Recently publish post More

    • 22 June 2018
      2 days ago No comment

      “My 2 Mommies”

      Review: Paolo Ballesteros Proves Versatility in Funny & Heartwarming Movie This year’s Regal Films new move is “My 2 Mommies”. Directed by Eric Quizon, it stars Paolo Ballesteros, Solenn Heussaff with the special participation from the Diamond Star Ms. Maricel Soriano, together with Joem Bascon, Dianne Medina, Mich Liggayu ...

    • 16 June 2018
      1 week ago No comment

      Why basketball is Pacquiao’s passion

      It’s no longer a surprise to many that after a gruelling, day-long grind on the road and inside a boxing gym, you still see Manny Pacquiao in a basketball gym playing the game second to his heart. For Filipino international ring icon, you see, basketball is his way of ...

    • 16 June 2018
      1 week ago No comment

      Bianca and Miguel’s show gets an extension

      Bianca Umali and Miguel Tanfelix are understandably elated since their hit primetime show, “Kambal, Karibal” gets another extension. Earlier, it was announced that it will be airing until June but now, it’s extended again and it will run until August. The series started airing in November last year so ...

    • 14 June 2018
      1 week ago No comment

      Yasmin as a lucky wife

      YASMIEN Kurdi’s husband, Rey Soldevilla, celebrated his birthday recently and got a surprise from the actress: a brand new Honda car worth about P1.5 million. Her fans say her husband is so fortunate to have her as his wife. “Suwerte rin naman ako sa husband ko,” says Yasmien when ...

    • 14 June 2018
      1 week ago No comment

      Kapatid ni Elmo Magalona, arestado

      Frank Magalona released from detainment with no charges Elmo and Maxene Magalona’s brother Frank was arrested in Taguig earlier today, June 4. According to a report by ABS-CBN News, Frank was taken into custody after he allegedly pinched a woman’s buttocks. The victim is a VIP host at the ...

    %d bloggers like this: