Sep 15, 2012

Philippines - Philippines Draws Inspiration From Singapore

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SYDNEY – The Philippine’s government is drawing inspiration from Lee Kuan Yew, the founder of modern Singapore as it seeks a path to prosperity and a developed economy, Finance Secretary Cesar Purisima said Thursday.

The admission that the Philippines is looking to Singapore, one of Asia’s most important financial hubs, shows the depth of ambition gripping Manila as the global power balance continues its shift towards Asia.

In an interview here during a trip to drum up support from Australian investors, Mr. Purisima said the development of the city state of Singapore into one of Asia’s most important financial and transport centers in recent decades is a model.

“Singapore is like a growing organism,” said Mr. Purisima. “Those watching from afar watch it with envy how far sighted they are,” he said.

Fast economic growth, strong investor inflows and a high profile anti corruption agenda put in place by President Benigno Aquino has made the Philippines one of the region’s star performers.

The Southeast Asian country’s gross domestic product expanded at an annual pace of 6.1% in the first half of this year, faster than the government’s full-year target of 5%-6%, driven by higher public spending and steady growth in private consumption due to remittances.

That growth has helped push the Philippines credit rating to within one level below investment grade according to Standard & Poor’s and Fitch Ratings.

Spelling out a confident outlook for his country, Mr. Purisima highlighted goals to double tourist arrivals from an expected 4.8 million this year to 10 million by 2016. He wants business process outsourcing–a way for multinationals to control costs by locating some operations offshore–to be a 25 billion dollar industry by 2016 from 11 billion dollars now.

Advice on how to grow the mining industry and opportunities for public private partnerships has been taken from the UK’s Treasury department, the Australian and Chilean governments, the Asian Development bank and others.

“Clearly we want to learn from other countries,” he said.

Taking a pragmatic view of the dispute between Manila and Beijing in the contested waters of the South China Sea, Mr. Purisima said the “multi dimensional” nature of relations between the two countries mean the spat doesn’t pose an overwhelming threat to stability.

To be sure, there are risks. A spike in oil prices would hurt the energy importing nation and cleaning up corruption remains a challenge.

“We’ve seen less anecdotes of corruption. There’s still corruption but it’s something we don’t tolerate,” he said.

But for now, luring foreign capital isn’t proving difficult for Mr. Purisima.

“Money is not the issue. The issue is how you deploy this money in a productive manner,” he said.

Enda Curran and Almar Latour



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