(Pleasantries)

Thank you for investing your time in this briefing. I am eager to share with you the Philippines’ promising growth story and how Australia can actively be part of this journey.

For nearly eight decades, the Philippines and Australia have enjoyed robust trade and investment relations and people-to-people ties.

Last year, Australia was the Philippines’ thirteenth biggest trading partner with total trade valued at 4.1 billion US dollars, 20.6 percent higher than in 2022.

We are encouraged by the positive shift of Australia’s net foreign direct investment inflows to the country beginning in 2022.

Australia now stands as our 16th largest contributor of net FDIs, totaling 5.7 million US dollars for the first eleven months of 2023.

We also welcomed 266 thousand tourists from Australia last year, making it our fourth largest source of tourist arrivals.

Similarly, Australia is home to more than 300 thousand Filipino migrants, constituting the fifth-largest migrant community in the country.

In turn, the Philippines is a reliable host to more than 250 Australian companies across various sectors, employing over 44 thousand Filipinos.

Clearly, there is plenty of room for our economic partnership to grow more extensively over the coming years.

With Australia’s sharpened focus on Southeast Asia, allow me to highlight compelling reasons why the Philippines is the strategic choice for your business and investments.

Today, we are the fastest-growing economy in the ASEAN region, expanding by 5.6 percent in 2023.

Multilateral organizations affirm the strength of the Philippine economy. They are expecting us to maintain our position as a frontrunner in ASEAN with a projected GDP growth of 5.8 percent to 6.3 percent in 2024.

Several factors are working in our favor as we build a strong domestic economy that is both globally competitive and inclusive.

Despite external challenges, inflation remains under control, dropping to 2.8 percent in January.

Our comprehensive Reduce Emerging Inflation Now or REIN plan will allow inflation to stay within the government’s target band of 2 to 4 percent this year.

The Philippines also boasts a vibrant labor market with a historically low unemployment rate, reduced underemployment, and faster labor force growth.

Meanwhile, our external position remains strong and stable. Our gross international reserves at the end of January 2024 stood at 103.3 billion US dollars, equivalent to 7.7 months’ worth of import cover.

The ratio of our reserve over the IMF’s assessing reserve adequacy metric is equivalent to 1.9, exceeding the recommended level and significantly higher than China, Malaysia, and Indonesia. This means we have a sufficient buffer against global economic headwinds.

The Philippines has also continued to have the lowest external debt-to-GDP ratios among the ASEAN-5 countries. This makes us the least vulnerable nation to adverse external shocks.

As of the third quarter of 2023, our external debt-to-GDP ratio stood at 28.1 percent, significantly lower than that of Malaysia, Indonesia, and Thailand.

Our fiscal performance remains robust and on track with our fiscal consolidation plan dubbed as the Medium-Term Fiscal Framework.

The framework is the first of its kind in our country and serves as our blueprint to reduce the fiscal deficit, promote fiscal sustainability, and drive robust economic growth.

In 2023, our fiscal deficit continued to narrow down to 6.2 percent of GDP from its peak of 8.6 percent at the height of the pandemic. It is well on its way to drop to just 3 percent in 2028.

This narrowing deficit path is attributed to the consistently higher government revenue collections and improved expenditure management, which prioritizes massive infrastructure projects, social services––particularly education, and other development programs.

Alongside the enhancement of tax administration efficiency through digitalization, six tax reform measures are underway to improve revenue mobilization, further sharpen our fiscal toolkit, and modernize the Philippine tax system.

We are also putting in place measures to efficiently execute the government budget to quickly deliver programs and projects for our people.

The significant reduction of the deficit signifies ongoing stabilization of our debt. In 2023, our debt-to-GDP ratio further dropped to 60.2 percent, a decrease from the peak of 60.9 percent in 2022. We are on track to bring this ratio down further to less than 60 percent by 2028.

This adherence to fiscal discipline and prudent debt management enabled us to maintain our high credit ratings amid the sea of downgrades globally.

Complementing our fiscal consolidation strategy, we have in place the Growth-Enhancing Actions and Resolutions or GEARs plan to rapidly expand economic growth.

A key aspect of this strategy is welcoming investors with open arms to achieve investments-led growth through improvements in the regulatory regime, reduction in the cost of doing business, and addressing constraints.

President Ferdinand Marcos Jr.’s swift enactment of the Public-Private Partnership Code is a resounding testament to our commitment to fostering stronger collaboration with the private sector.

The PPP code offers a stable, predictable, and competitive environment where high-quality PPP investments can thrive.

It leverages over three decades of experience with our Build-Operate-Transfer Law and integrates best practices to streamline processes, reduce transaction costs, and enhance the ease of doing business for PPPs.

Under the President’s Build Better More program, we have 185 big-ticket infrastructure projects worth roughly 9 trillion pesos or about 163 billion US dollars primed and ready for PPP investments.

These include a wide spectrum of projects that you can choose from—including power, physical connectivity, rural development, water resources, digitalization, sustainable initiatives, and healthcare.

We have taken great care to ensure the economic returns on our major projects, choose the most highly concessional financing available, and diversify our sources of project funding.

Perhaps the story of the Ninoy Aquino International Airport PPP Project—the administration’s largest PPP endeavor to date—demonstrates how quickly and efficiently the government acts on investments.

The government evaluated the solicited proposal to rehabilitate our country’s primary international gateway in just six weeks––the fastest approved PPP proposal in Philippine history.

We recently awarded the contract to the winning private-sector consortium bidder for the project. This deal is projected to generate approximately 16 billion US dollars in government revenues over its 15-year concession period, with an option for a 10-year extension. The capacity of the airport will be about 62 million passengers. This is a major win for our people, the government, and the investors involved.

Rest assured, you can expect nothing less than the same speed and efficient handling of your investments when you partner with us.

Additionally, the government has recently established its first sovereign wealth fund called the Maharlika Investment Fund.

Australian investors seeking to broaden their portfolios into rapidly expanding markets such as the Philippines should explore potential ventures within the Fund. It provides an opportunity for private-sector engagement in financing our big-ticket infrastructure projects.

The Philippines also warmly welcomes expanded investment opportunities, particularly in telecommunications, transportation, banking, mining, and energy sectors, following the recent implementation of our liberalization laws.

With the amendments to the Retail Trade Liberalization Act, the minimum paid-up capital requirement for foreign corporations has been lowered from 2.5 million US dollars to about 500 thousand US dollars. We likewise streamlined the qualification requirements for foreign retailers.
The amendments to the Public Service Act allow 100 percent foreign ownership in public services.

Changes to the Foreign Investments Act improve the Philippines’ openness to FDIs and liberalize the practice of professions.

The Philippines is also now open to full foreign ownership of renewable energy projects, which unlocks the floodgate for more partnerships in clean energy investments.

In addition, we are currently refining the country’s fiscal incentives system to further tailor fit incentives and attract international enterprises to invest in strategically important projects.

These measures broaden investment opportunities and synergy between local and international companies, especially in cutting-edge technologies and green investments.

All these complement the investment and capital market reforms we are pursuing to align all of our initiatives with the best practices of major Asian peers.

Another critical yet often overlooked factor that makes us even more confident in our economy’s long-term outlook is our very young and very well-educated population.

The Philippines enjoys a median age population of 25 years old. This stands in stark contrast to the aging populations of our more developed industrial neighbors, like Australia, with a median age of 41.

Our young, tech-savvy, English-speaking workforce complements Australia’s forward-thinking businesses and highly skilled labor force. This sweet spot provides an opportunity for the Philippines and Australia to become demographic partners.

Without a doubt, the Philippines stands out as one of the most hospitable economies for business.

I invite all our friends here in Australia to take a closer look at the progress made in the Philippines. There is a wide range of investment opportunities waiting to be explored. See for yourself how we prioritize prudent economic management to ensure stability for business.

Keep in mind that you are teaming up with the fastest-growing economy in Asia. Our resilience has been tested and proven strong.

Our young population is eager to work with forward-looking enterprises. You are backed by pro-business policies and a President with decisive political leadership.

We have rolled out the red carpet and reserved the best seat for you to join us in shaping our blockbuster growth story. This is an exciting opportunity that Australian investors should certainly not miss out on.

Thank you. Mabuhay ang Bagong Pilipinas.