DESPITE the dramatic decline in global trade coupled with protectionist forces in advanced global economies, exports will remain a major growth driver for most Asian economies such as the Philippines, according to an economist from the Asian Development bank (ADB).
In a forum organized by state think tank Philippine Institute for Development Studies (PIDS), Ganeshan Wignaraja, advisor at the ADB Office of Chief Economist, dispelled speculation that an exports slowdown will lead to an end of Asia’s era of export-led growth, saying that this projection is “overdone.
Wignaraja attributed the export slowdown in developing Asia to three major factors: (1) the weak import demand for Asian goods in advanced economy markets; (2) the structural transformation and reduced import demand from China; and (3) the possible impact of increasing nontariff measures (NTMs).
He, however, argued that there are trading opportunities that developing Asian economies can profitably nurture.
To benefit from these new trading opportunities, the Philippines and other Asian countries, must put in place reforms to reduce behind the border barriers by upgrading skills, enhancing SME financing, investing on and upgrading seaports, logistics, and digital infrastructure.
In the Philippines, Wignaraja cited the need to improve roads and ports to encourage more tourists to visit the country. He also pointed out the need to further improve the ease of doing business to attract more investors, and bring down the high cost of electricity, which is an important input in manufacturing.(PIDS)
