Trump beneficial for Philippines, not for Asean neighbors

A joint survey of the Japan Center for Economic Review and business pub­lication Nikkei Asian Review showed that the impact of President Donald Trump’s impact in Southeast Asia will differ by country but is expected to be beneficial for the Philippines.

This, as Trump takes over as the world’s most powerful leader, with experts raising grave concerns over the uncertainties brought about by his mostly uncon­ventional policies mainly on foreign relations.

For instance, Trump courted a diplomatic back­lash recently by accommo­dating Taiwan President Tsai Ing-Wen as China insisted that he respect the One-Chi­na policy. Trump shot back using social media saying China can’t dictate on whom he can talk to.

While the economists polled in the survey jointly conducted by the Japanese firms revised their 2017 growth forecasts downward for four Southeast Asian countries, namely, Indone­sia, Malaysia, Singapore and Thailand, partly reflecting the Trump factor, the pros­pect was revised upward for the Philippines.

India’s forecast, too, was revised down for 2016/17, but this was seen as just as much a reflection of the tem­porary effects of demonetiza tion, the survey showed.

The growth forecast for the weighted average of the five biggest Association of Southeast Nations (Asean) economies for this year was also revised downward from the previous survey by 0.2 points to 4.4 percent, as the figures for Indonesia, Malaysia, Singapore and Thailand were reduced.

The only exception was the Philippines, the forecasts for which were raised through 2018, supported by strong domestic consumption and investment. Estimated growth rates for 2016 to 2018 are between 6.5 percent and 7 percent.

“Rising protectionism and other Trump-related risks are widely shared in the region. The risks are taken seriously in such countries as Singapore, which stands on open economy,” the survey said.

The survey, done from Dec. 2 to 16, collected 57 answers from economists and analysts in the five biggest Asean economies and India.

Many economists throughout the region share the view that anxiety over protectionism has been raised and volatility in the markets has increased after Trump’s November victory.

The effects are “mainly on capital outflow and the possibility for protectionism,” said Umar Juoro, chairman of Center for Information and Development Studies in Indonesia.

The prospects are stronger for the Philippines. Both public and durable equipment investments “can help boost construction,” said Professor Alvin Ang of Ateneo de Manila University.

Views on the risks posed to the respondents’ own economies also differed by country. The rise of protectionism and other risks are taken less seriously in India and the Philippines in the region.

The rise of protectionism and a slowdown or decrease in world trade was cited as the biggest risk for Singapore and Thailand and the second biggest in Malaysia and Indonesia. Financial turmoil triggered by the policies of Trump was seen as the third-biggest risk for Malaysia.

For the Philippines, economists focused more on domestic risks, such as political instability and infrastructure insufficiency.

Philippines economic growth will be bolstered by faster government outlays, the survey said.

“Job generation has been robust in 2016 and the unemployment rate is expected to continue to decline, nearing 5 percent,” according to the survey.

The poll, however, said economists expect US government policies under Trump to affect local outsourcing businesses.

But Security Bank analyst Albert Taningco, one of the survey respondents, said Trump’s policies can be positive in the long term if bilateral relations between the Philippines and the US strengthened.

“Tax reform and infrastructure programs are seen as the most important domestic issues. Other important events and topics include issues surrounding Charter change and federalism, and the appointment of the new Bangko Sentral ng Pilipinas (BSP) governor.