MANILA – The Makati Business Club (MBC) is optimistic on the economic growth in the coming quarters as the government ratified the Regional Comprehensive Economic Partnership (RCEP) and released the new implementing rules and regulations (IRR) of the Public Service Act (PSA).
“Two recent developments may aid economic growth in the near future,” it said in a statement Thursday, after the country posted a 6.4-percent gross domestic product (GDP) growth in the first quarter of 2023.
The business group cited the issuance of the IRR of the amendments to the Public Service Act, which liberalizes key sectors such as telecommunications and transportation.
“The Philippines also recently ratified the Regional Comprehensive Economic Partnership Agreement in February 2023, which is currently the world’s largest free trade agreement,” it added.
The IRR of the PSA took effect last April 4, while the RCEP will enter into force in the country on June 2.
With the issuance of the new rules on PSA, the country has allowed 100 percent foreign ownership of public services, such as airports, railways, expressways, and telecommunications.
RCEP, on the other hand, will allow a better flow of trade and lower to zero tariffs on some commodities being traded among the 15 participating countries —the 10 Association of South East Asian Nations (ASEAN) member states, and trading partners China, Japan, South Korea, Australia, and New Zealand.
Meanwhile, the 6.4 percent GDP in the first quarter was slower from the 7.1 percent in the previous quarter, and the lowest since the start of recovery in second quarter of 2021.
“However, this exceeds the forecasts of local economists whose estimates are within the median of 6 percent and slightly exceeds recent forecasts of the Asian Development Bank and the International Monetary Fund who both projected around 6 percent,” the MBC said.
The country’s GDP in the first three months of the year remains within the government target of 6 to 7 percent. (PNA)