European businesses ‘cautiously optimistic’ about PHL in 2019

European businesses are “cautiously optimistic” about doing business in the Philippines this year, given the several uncertainties currently hounding the country.

Most of the members of the European Chamber of Commerce of the Philippines are optimistic when it comes to the country’s business environment, but accompanied by cautiousness, ECCP president Nabil Francis said in a press conference in Taguig City on Wednesday.

“Cautious optimism should prevail and those are good reasons to continue to cultivate a good relationship between the EU and the Philippines.”

Francis noted that European businesses are entertaining uncertainties about the effect of higher policy rates on the country’s economic growth.

“One of the headwinds was inflation, and the (Bangko Sentral ng Pilipinas) has acted in a very bold step. Money is expensive now in the Philippines. We are a little bit worried about the impact of such a move on the growth,” he said.

“Despite this move, growth is still there. Six percent is a good number … placing the Philippines with some of the best-performing countries in Southeast Asia. So it’s resilient and this is encouraging” Francis added.

The central bank raised key interest rates five consecutive times for a cumulative total of 175 basis points in 2018, citing a worrisome inflation.

Inflation surged to 6.7 percent in September and October last year, the fastest in over nine years since it clocked in at 7.2 percent in February 2009.

Francis noted that headwinds overseas are creating most of the uncertainties.

“We are starting the year with a lot of uncertainties and those uncertainties are not emanating from the Philippines, but it may have an impact on the economy,” he said.

This includes issues on the leadership of US President Donald Trump, as well as the tensions between US and China, the world’s biggest economies. —VDS, GMA News