First the good news, according to the Institute for Development and Econometric Analysis, Inc. (IDEA) latest NewsBriefs, “the Cebu business process outsourcing (BPO) segment is targeting to take hold of 20% of the Philippine BPO market by 2010. Currently, the BPO industry in Cebu is organizing an Information and Communications Technology 2009 Conference aimed at realizing these goals through partnerships with emerging BPO markets and infrastructure development.”
Likewise, corporate giant, San Miguel Brewery, Inc. raised US$800 million with its corporate bond offerings. It priced its three-part peso bond at around 250 basis points higher than reference Treasury bonds. The brewery was able to sell its three-part peso bonds with three-, five-, and ten-year durations to finance its purchases of beer brands and land from its parent company, San Miguel Corporation. The corporate bond offering was the largest in the Philippines. In addition, Japanese brewery Kirin Holdings has expressed its interests in buying a stake in the Filipino brewery in light of Kirin’s goal to expand its market to Asia and Oceania.
Furthermore, the government sold its benchmark seven-year Treasury bonds this week at an average interest rate of 6.05%. The bidding brought in Php8 billion which would help in funding the budget deficit. Overall, the Treasury is optimistic over the demand for benchmark government papers.
However, per same published report, “the country’s external financial position has weakened in February 2009. In the said month, the Philippines had a balance of payments (BoP) surplus of US$469 million, almost a three-quarter drop from the January position of US$1.735 billion surplus. The current position was also more than 50% weaker compared to the same month last year which posited the BoP to US$1.05 billion. Income from investments, National Government loans from the Asian Development Bank and the World Bank, and foreign exchange transactions by the Bangko Sentral were the factors for the positive status of the country’s BoP surplus.
Finally, the sad news was that, the unemployment rate soared to 7.7% in January, equivalent to about 2.85 million jobless people. The increase in unemployment was due to the weakness of the electronics and manufacturing sectors, which suffered from low export demand amidst the global economic crisis. The unemployment rate is the highest since April of last year which reached 8%. Export targets are expected to downgrade even further as outlook in the electronics sector is growing bleaker for the coming months. Electronics exports are seen to decline by about 20% to 30% in 2009. The forecast adjustment implies an estimated total export contraction of about 6% to 8%, according to IDEA.
Source: The Freeman Cebu
