CEBU, Philippines — “Don’t stop spending,” renowned economist and urban planner Ronilo Balbieran advised Cebuano businessmen during the recently held Mandaue Chamber of Commerce and Industry (MCCI) Business Summit.
Balbieran urged the Cebu private sector not to hold on to their money, “but spend.” This is the secret in keeping the economy afloat amid uncertainties and prepare for the overwhelming surge of economic growth after the Philippines achieve ideal hers vaccination.
The Philippine economy, which is 73% fueled by consumption, sluggish activity in spending could hurt further the already bleeding economy.
“Let’s put our acts together to accelerate recovery,” he said explaining further that continuous spending, whether for consumer goods, investments including expansion [in preparation for the economic growth surge], and miscellaneous spending help cushion the country’s fragile economic health.
Looking back in 2020, which was considered as the worst global recession after World War 2, spending of Filipinos in miscellaneous goods, like perfume, lipstick, hair gel, plants [for plantitos and plantitas], among others served as the magic wand in keeping the country’s economy alive.
Spending at this time, he reiterated not only help exercising the muscle of the economy, it will also gives consumers the opportunity to buy products at cheaper price as the demand is still weaker.
There is no question, he underscored that the Philippine economy will recover, but the timeline depends on several factors like sustained or dynamic spending from private sector, as well as government, and high rate of vaccination among its population.
He warned that it is important that the Philippines will be able to handle the surge of economic growth once herd immunity is achieved. Businesses as well as consumers should be ready for the recovery.
He mentioned the commercial banks’ awash of cash, just waiting to be tapped by capitalists. Small and Medium Enterprises (SMES) however, should work with conduit agencies like Phil Guarantee for instance in order to avail of capitalization loans from banks.
Moreover, the Philippines should also be prepared to handle the “revenge spending” of people from all over the world once mobility re-opens. Tourism and other related industries should be ready for this, he added.