Sunlife sees 6.7% growth for Phl

MANILA, Philippines – The Philippine economy is expected to grow by 6.7 percent this year, slower than the projected seven percent growth for 2016, Sun Life of Canada said.

“The Philippine economy will continue to grow strong,” Sun Life chief investments officer Michael Enriquez said in a briefing yesterday.

 The downward revision was due to the absence of election spending which helped buoy last year’s growth, Enriquez said.

He said the Philippine economy remained strong and short-term issues such as concerns over the policies of US President Donald Trump were only temporary.

“Short-term issues won’t affect the Philippine growth story in the long term,” Enriquez said.

He said the economy could even grow by seven percent this year if there were stronger catalysts.

Dollar remittances from overseas Filipinos would continue to support consumption while the government’s planned tax reform package would help spur economic growth.

 Enriquez said the Duterte administration’s plan to boost infrastructure spending to seven percent of the country’s GDP from the current five percent would also be a major catalyst for growth.

“Remittances from overseas Filipino workers, the BPO industry and the large number of Filipinos who are of working age are among the factors boosting our economy from the consumer’s end. On the other hand, the rise in government spending is bringing about more jobs and has also increased the demand for construction materials,” Enriquez said.

 He said these positive developments have offset the possible impact of recent events in the market. These include the weakening of the Philippine peso against the US dollar and the drop in the Philippine Stock Exchange index due to the shift of foreign funds to the US market.

The rate hikes planned by the US Federal Reserve could weigh down on the peso and stocks, Enriquez said. 

Nevertheless, he said external risks may just be a short term drag.

For investment strategies, Enriquez advised investors to stay the course and even boost their investments.

 “With stock prices cheaper, it’s good to buy so they can enjoy the greater gains once the market goes up,” he said.

 Sun Life Asset Management Co. Inc., president Valerie Pama urged the public to invest in mutual funds such as SLAMCI.

“The Sun Life Prosperity Philippine Equity Fund, for instance, yielded a five-year return of 39 percent and a 10-year return of 119 percent,” she said.

Moving forward, SLAMCI would pursue this vision by championing financial inclusion and further boosting its financial literary programs to educate Filipinos about the best ways to grow their money. The company will also strengthen distribution channels to reach new makers.

“More partnerships with banks, brokers and alternative channels will be launched and we will also enhance our online capability including the Money for Life e-Planner,” Pama added.

SLAMCI will also be more aggressive in promoting its programs such as Sun Rise, wherein employees can invest a minimal amount via salary deduction; and Auto-Invest, a regular investment program in cooperation with partner banks.