2015年-世界发展银行全球_Philippine_Economic_Update_October_2015___Making_Growth_Work_Better_for_Small_Businesses_88页_4mb

Philippine Economic Update Summary (October 2015)

Core Content

The Philippine Economic Update (PEU) provides an overview of recent economic developments and policy changes in the Philippines, focusing on growth, employment, poverty, and business environment reforms. The report emphasizes the need for structural reforms to make economic growth more inclusive, especially for small and medium enterprises (SMEs).

Main Points

Economic Performance

• GDP Growth: In the first half of 2015 (H1), the Philippines grew at 5.3%, its lowest half-year growth since 2011.
• Sectoral Growth:
  • Agriculture: Growth slowed to 0.3% due to El Niño, with the crops sub-sector contracting by 0.5%.
  • Industry: Grew at 5.8%, down from 7.3% in 2014, mainly due to a slowdown in manufacturing.
  • Services: Grew at 5.8%, led by the informal sector, contributing 3.3 percentage points to GDP.
• Demand Side: Private domestic demand grew by 8.1%, supported by low inflation and remittances.
• Government Spending: Grew by 3% in H1 2015, with a significant rebound in Q2 due to increased capital outlay.
• Net Exports: Contributed negatively to GDP growth, taking away 2.6 percentage points due to weak export performance and strong import growth.

Employment and Poverty

• Job Losses: The agriculture sector lost around 877,000 jobs due to El Niño, while industry and services created fewer jobs than lost, resulting in a net loss of about 96,000 jobs between July 2014 and July 2015.
• Underemployment: Increased significantly to 20.8%, reflecting the high informality rate (over 75% of workers).
• Poverty Reduction: Poverty fell by about two percentage points from 2012 to 2014, but increased in 2014 due to natural disasters and delayed rice imports. If growth continues, extreme poverty is projected to fall to 8.2% in 2017.

Financial Markets

• Equity Market: Experienced sharp declines after reaching a record high early in the year.
• Sovereign Bonds: Prices rose, reflecting confidence in the country's fundamentals despite global uncertainties.
• Monetary Policy: Remains supportive, with the peso stable in real terms and flexible.
• Non-Performing Loans: Remain at low levels, and capital adequacy ratios are high.

Key Policy Insights

Fiscal Policy

• Tax Effort: Increased to 14.1% of GDP in H1 2015, up from 13.7% in H1 2014, due to improved tax administration and strong private sector growth.
• Government Spending: Lags behind budget targets, with a 18.5% increase in the budget but only an 8.5% increase in expenditures from H1 2014 to H1 2015.
• Reforms Needed: To improve growth inclusivity, the report suggests increasing spending efficiency, improving budget transparency, and aligning tax policies with inflation.

Business Regulation Reforms

• High Costs: Starting and maintaining a business, especially for MSMEs, is costly with both direct and opportunity costs.
• Opportunity Cost: Estimated at PHP 100 billion annually, with additional PHP 40 billion from discouraged entrepreneurs.
• Recommendations:
  • Simplify and automate key business registration processes.
  • Implement the Philippine business registry and regulatory simplification program.
  • Introduce alternative payment systems (online, mobile).
  • Reduce frequency of license and permit renewals.
  • Adopt a risk-based approach for business permits.
  • Simplify the tax regime for micro and small businesses.

Export Procedures

• High Costs: Export transaction costs are relatively high compared to neighboring countries, with small exporters facing significant hurdles.
• Recommendations:
  • Enhance coordination among trade-related agencies via the National Single Window.
  • Improve the efficiency of the Bureau of Customs' IT system.
  • Publish clear performance standards and establish a national trade website.
  • Eliminate or re-engineer redundant and inefficient export steps.

Medium-Term Outlook

• Growth Prospects: Expected to accelerate to 6.4% in 2016, then moderate to 6.2% in 2017.
• 2015 Growth: Revised down to 5.8% due to weak H1 performance, but likely to improve in H2 with increased government spending and lower oil prices.
• Poverty Reduction: Can continue if growth and job trends are maintained, with extreme poverty projected to decrease to 8.2% in 2017.
• Structural Reforms: Needed to reverse decades of bad policies and improve the investment climate. These include:
  • Institutionalizing reforms for budget transparency and accountability.
  • Reforming the tax system to be simpler, more equitable, and performance-based.
  • Reducing the investment negative list and tackling monopolistic practices.
  • Securing property rights through land governance reforms.
  • Re-engineering business regulations to be less costly and more efficient.

Conclusion

The report highlights that while the Philippines has shown strong economic fundamentals and growth potential, it faces significant challenges in making growth more inclusive. These include high business start-up and maintenance costs, weak government spending execution, and high export transaction costs. Structural reforms are critical to unlocking the potential of SMEs and achieving sustainable, inclusive growth and poverty reduction.