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What Investors Are Looking for in Marcos’s First Congress Speech

·3 min read

(Bloomberg) -- Philippine President Ferdinand Marcos Jr. will lay down his agenda before Congress for the first time, with economic challenges looming large in the early days of his administration.

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Business and industry groups want to hear Marcos talk about how he would tackle soaring prices, record debt and food supply woes in the speech scheduled for 4 p.m. local time Monday. Also awaited during the annual State of the Nation Address are his pandemic recovery plan and infrastructure roadmap.

Marcos is starting his six-year term “with headwinds already there,” said Philippine Chamber of Commerce and Industry President George Barcelon. “These are not of the new administration’s doing but these are issues they have to deal with.”

While the Philippines remains one of Asia’s fastest growing economies, the quickest inflation since 2018 and rising interest rates are threatening pandemic recovery. Elevated oil prices and supply logjams that are the fallout from the war in Ukraine have also dimmed the global outlook.


Marcos, who’s also the agriculture secretary, has to give “total support” to the farm sector to avert a food crisis and tame price increases, said Joji Co, president of the Philippine Confederation of Grains Association.

Marcos should set clear plans on how to boost food production, and allot a bigger budget to modernize farms, Co said. Agriculture posted the smallest growth among major industries in the first quarter, with a 0.2% expansion.

Debt & Taxes

Marcos will present in detail his government’s medium-term fiscal framework aimed at reducing the budget deficit and driving growth, Finance Secretary Benjamin Diokno said earlier this month.

The new government may need to pursue tax reform measures to boost collections and bring down the debt-to-GDP ratio to “more sustainable levels” below 60%, said Michael Ricafort, an economist at Rizal Commercial Banking Corp. That will prevent any credit rating downgrade, he said.

Marcos’s plans on how to boost revenues and whether he’ll borrow more or raise taxes are keenly awaited in the market, said Astro del Castillo, managing director at First Grade Finance Inc.

Covid response

Marcos will draw attention to pandemic response, particularly how to strengthen the health system and boost the economic recovery, Executive Secretary Vic Rodriguez said July 22. The president will also present plans on school reopening, and providing better Internet connection for those who will still need online classes.


Creation of more jobs is among the priorities of investors after the pandemic increased the number of unemployed over the last two years. The jobless rate was at 6% in May, latest data from the statistics agency showed.

“How to improve government service in health and education and how jobs will be created - that’s what our countrymen want to hear in the upcoming SONA,” said Senator Sonny Angara.


The market will be on the lookout for government’s infrastructure investment policy, said Cristina Ulang, head of research at First Metro Investment Corp. “It’s closely watched because it’s a growth stimulus and a test of how well regulatory framework will be executed,” she said.

“We hope the president sends more signals that business is welcome again as a partner; that laws, franchises, and contracts will be upheld and targeting businesses politically be stopped,” Makati Business Club Executive Director Coco Alcuaz said.

Former President Rodrigo Duterte cracked down on some of the biggest businesses during his term as he pushed a populist agenda that endeared him to his supporters.

A healthier relationship between government and businesses will help boost private investment in infrastructure projects which the country needs for growth, Alcuaz said.

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