MANILA – The Philippines, along with the rest of Asia, stands to benefit from the Joe Biden presidency due to the expected reduction of risk from the US-China trade war, as well as less protectionism and a possible increase in government stimulus.
In a report, Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said the possible decline of trade war concerns could result in increased global trade and economic growth, especially in Asia.
Ricarfort said a lesser protectionist stance in the US could also benefit the Philippines’ imports and exports, as well as remittances and the business process outsourcing (BPO) sector.
Citing the latest domestic BPO sector figures, Ricafort said the US accounts for about 70 to 80 percent of BPO business in the Philippines.
The BPO sector is now among the growth drivers of the domestic economy, along with remittances and exports, among others.
Similarly, Ricafort said the institution of additional US government spending that the Democrats, which US President-elect Biden is part of, has been pushing, could result in better economic outcomes for the world’s largest economy and benefit its trade partners like the Philippines.
He said the Philippines is also seen to benefit from Biden’s preference for renewable power since this power source accounts for a big share in the domestic energy mix.
He added that the larger number of Republicans in the US Senate “could prevent the enactment of a larger stimulus, higher taxes on the wealthiest, tighter regulations and could temper the upside of (the) US gov’t. bond yields” amidst these factors.
Ricafort said there have been lots of changes in recent years and “the Philippines would also adapt to these changes in the US, towards greater cooperation such as in obtaining more assistance on Covid-19 (coronavirus disease 2019) vaccines, infrastructure, security, and defense locally and in dealing with the West Philippine Sea.”
“Things have indeed changed over the past three-four years, more towards cooperation in terms of diplomatic, business, and international relations between the Philippines and the US,” he added.