A business executive on Wednesday raised the need for greater focus on policy reforms, investments and competitiveness of the Philippines’ various industries to bolster growth and help support investors’ confidence.
This, as the Philippine Stock Exchange index (PSEi) continues to slip and is now below the 6,000-level.
“Markets can price in uncertainty, but economies grow on confidence. The best response to today’s headwinds is not more political noise, but more focus on reforms, investments, and competitiveness that will move the economy forward,” Elizabeth Lee, Federation of Philippine Industries (FPI) chairperson, said in a message to the Philippine News Agency.
Lee said the local bourse’s main index “is primarily a confidence indicator.”
“A falling stock market does not directly cause factories to produce less. However, it reflects investors’ assessment of the business environment, and that caution can eventually influence decisions on investment, expansion, hiring, and financing,” she pointed out.
Asked for specific programs that the government should focus on, Lee said these are industry sector-specific and not across the board.
“But one thing for sure though — do not make things harder for businesses that are also trying to keep their operations above water, especially MSMEs (micro, small, and medium enterprises),” she said.
In a statement, Lee said the drop of the PSEi is due to several factors such a “elevated inflation, a weakening peso, geopolitical risks arising from tensions in the Middle East, and softer expectations for corporate earnings.”
For manufacturers, this development “translates into higher input and logistics costs, currency-related cost increases, and continued pressure on already thin margins,” she said.
Thus, the need for “clear signs of economic stability, stronger competitiveness, and renewed growth momentum” to assure investors that the situation will be better.”
“The stock market is not causing these challenges; rather, both investors and manufacturers are responding to the same underlying headwinds. The market’s decline is therefore less a measure of current production activity and more a reflection of caution about the near-term business and earnings outlook,” she added. (PNA)
