I stumbled upon this article in inquirer about RP economy being able to withstand global economic downturn because two of three of the most important income drivers remain intact. It is no secret that our exports, the first pillar, is getting a beating. However, a certain economist is saying that the two remaining pillars of the economy remain relatively robust. These pillars are Remittances and BPO Services.
This made me look for the latest data on remittances. As of End February, remittances grew only by 4.9% year-on-year, and 2.5% growth year-to-date. While scratching my head, I am quite confused. These numbers are far from robust. Our country used to experience remittance growth of around 20%, which is already on the conservative side. This is actually a deceleration. It only highlights that the economy’s milk cow is running out of milk. While I cannot say am certain, but there is a high possibility that remittances will crumble sooner than we think.
Next on the list is the BPO services. The economist is saying that revenues of business process outsourcing firms are still strong. But there are silent horror stories about lay-offs in the sector. Back offices are also laying off people, as mentioned in this blog before. This is not a good sign since most of employment opportunities are on the BPO now.
So, are we free from the effect of global recession? I think we shall be affected, and only time will tell. But saying that these pillars are still intact is refusing to accept the truth.
