BOP surplus hits record high of $14.4B
Bangko Sentral sees further improvement in 2011
By Michelle Remo
Philippine Daily Inquirer
MANILA, Philippines—The sustained increase in remittances, higher export earnings and a surge in foreign capital inflows lifted the surplus in the country’s balance of payments (BOP) to an all-time high of $14.4 billion in 2010.The Bangko Sentral ng Pilipinas on Wednesday said the BOP surplus cemented claims that 2010 was a banner year for the Philippines especially in terms of inflows of dollars and other foreign currencies. The surplus, the highest ever recorded, was more than double the $6.42 billion registered in 2009. For December alone, the surplus stood at $1.23 billion, up slightly from $1.22 billion in the same month of the previous year. The BOP is a record of the commercial and financial transactions of the country with the rest of the world. A surplus, which indicates that the inflows are more than the outflows, adds to the Philippines’ total reserves of foreign currencies or the gross international reserves (GIR), which reflects the country’s ability to pay for imports and services and settle maturing debts to foreign creditors. The central bank earlier reported that the country’s GIR registered a historic high of $62.1 billion as of the end of 2010.
Asian FDI gains noted by UN; investors bypassing Philippines?
SEVERAL Southeast Asian economies enjoyed as much as a five-fold increase in foreign direct investments (FDI) last year while the Philippines was recording a decline, United Nations data released on Monday showed. The national elections in May and the ensuing government transition, said local observers, possibly caused the hesitation, which was also exacerbated by the country’s allegedly unattractive business climate. FDI flows into Malaysia, Indonesia and Singapore in 2010 were estimated to have surged by triple-digit rates from yearago levels as Southeast Asia was among the regions that led the global economic recovery, the UN Commission on Trade and Development (UNCTAD) said in its Global Investment Trends Monitor. Malaysia was projected to have grown its FDI by 410% to $7 billion while Indonesia similarly enjoyed a 163% rise to $12.8 billion, the UN agency said, annualizing available data for the three quarters of 2010. Singapore, meanwhile, likely saw FDI levels grow by 123% to 16.8 billion. These improvements allowed inflows to South, East and Southeast Asia to rise by 17.8% to $274.6 billion while the global average flattened to $1.122 trillion in the same year, the UNCTAD said. Full-year estimates for the Philippines were not included in the report but the country, according to latest central bank data, recorded an annual 36.5% decline in FDI as of October. The disparity was likely caused by last year’s elections, University of the Philippines economist Benjamin C. Diokno said in a text message yesterday. "Investors adopted a wait-and-see attitude given the change in political leadership," Mr. Diokno said. He added that the high level of investments already in neighboring economies allowed them to enjoy a faster recovery as well. Foreign business group officials echoed this but also noted that the country’s perennial lack of competitiveness was also to blame. "We’re not competitive," American Chamber of Commerce of the Philippines Executive Director Robert M. Sears said in a telephone interview. "It behooves the administration to realize that all three [branches of government] from the executive, legislative and judiciary have to work together to improve the country’s investment image." Long-proposed moves to improve infrastructure have just started, European Chamber of Commerce of the Philippines Executive Director Henry J. Schumacher said in a text message. -- Jessica Anne D. Hermosa
It’s going to be a rainy summer; no dry season
By Kristine L. Alave
Philippine Daily Inquirer
MANILA, Philippines—Summer is supposed to be the dry season in the country. Not this year.
It’s going to be a wet summer that will have typhoons due to the La Niña phenomenon that has been spawning rains in the Philippines since December, the weather bureau said Wednesday. The Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) said large parts of the country would get above-normal rainfall in the summer months of March, April and May. Tropical cyclones “This means that we expect to have a rainy summer. We expect to have tropical cyclones,” Flaviana Hilario, chief of PAGASA’s climatology and agrometeorology division. She said weather models and advisories from various national meteorological centers forecast La Niña to last until May, with the peak occurring in February. The months from March to May are considered the height of summer in the country, when millions troop to the beaches. These months are usually the driest months, with typhoons making an appearance only in mid-May. Typhoons in March-May Citing meteorological models, Hilario said there was a “slim chance” that a typhoon would enter the Philippine area of responsibility next month. PAGASA expects one typhoon in March, two in April and another two in May. June, the start of the rainy season, is expected to have two to three typhoons, Hilario said. La Niña arrived in the Philippines last October. The phenomenon, the opposite of El Niño, occurs when the surface temperature in the Pacific Ocean gets colder. El Niño refers to the increase in the surface temperature in the Pacific Ocean. The Philippines will be under heavy cloud and will experience cooler temperatures in the next five days as a result of the combined effects of the tail end of the cold front and the northeast monsoon. | 
