ph won’t be a bubble anytime soon
DESCRIPTION
There have been arguments lately that Philippines is about to experience a bubble anytime soon. However, Filipinos are optimistic to believe otherwise. Here are some of the reasons provided by some of the experts in the industry.TRANSCRIPT
PH Won’t be a
Bubble Anytime
Soon
Filipinos remain as the world's most confident consumers--
in spite of dropping 3 points in overall optimism during the previous quarter -
- according to latest survey results of market research firm Nielsen.
• Consumer spending contributed
Php 1.18-million in the 3rd quarter
of 2013 alone.
• Rising trend in Construction and
Real Estate segment.
• Increased purchasing power among
the middle class.
• The BPO industry continues to post
growth as shown by the nearly
unchanged office space take-up in
the major CBDs.
This optimism has helped spur the country's
economy:
However, some experts believe that the country is
on its way to an economic bubble.
Points from Jesse Colombo, a Forbes contributor:
The bank's ultra-low
lending rates is
encouraging both
consumers and
companies to spend
beyond their means.
Sudden withdrawal of
quantitative easing on
emerging market
economies will put
pressure on PH's
financial markets and a
global crisis will put OFW
remittances at risk.
He also warned about an
impending property
bubble due to the
overbuilding of
properties from the real
estate sector, which has
expanded the country's
economic growth in the
past years.
NO IMPENDING ECONOMIC BUBBLE
Colombo ignored the fact that at a time when
a bubble should be supposedly occurring, PH
still has an account surplus due to the high
volume of OFW remittances.
Boo Chanco of the Philippine Star wrote that:
Banks are actually prudent in lending money
and that the Bangko Sentral ng Pilipinas has
also tightened its policies and mandated a
limit on real estate and mortgage loans.
PROPERTY MARKET IS STRONGER THAN
EVER
Demand for office and retail spaces also
shows no signs of slowing down, thanks
to the rising BPO sector even in next
wave CBDs in other parts of the
Philippines.
Colombo underestimated the contribution of
OFWs and the middle-class sector to the
economy.
There is an existing demand in residential
space and so far, the number of
developments in the pipeline is just enough
to cater to that demand.
THEREFORE, FILIPINOS HAVE ENOUGH REASON TO
REMAIN OPTIMISTIC
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