Looking at the economic perspective, the philippines hasn’t been a favorable investment

destination since its decline from the 1980s.

Currently, our interest rates have been on the rise with looming rate hikes as the current
tightening measures of the government to protect the economy. So what does this mean
to the investors? They may choose to lend but for those who wanted to put up businesses
and are considering to make use of domestic funds, the rising interest is particularly
dissuading.

Next is inflation. The Philippines has recorded the highest inflation rise in the ASEAN
region following the effects of the pandemic. It even breached the target levels of the
government. With rising inflation, investors may expect the cost of doing business in the
country to rise. With increased cost of commodities, workers would demand higher
wages which would eventually trickle down to expenses to their businesses.

Various credit agencies such as Moody’s and S&P have noted the potential risk of long
term scarring in the economy of the country. This scarring is the after result of the several
borrowings that the government made as a response to the COVID pandemic. This will
truly be a huge consideration for investors as the government would channel efforts in
repayment of such loans instead of focusing on improvement of quality of living in the
country through expenditure on infrastructure and other social costs in the country.

In terms of business confidence, several groups of investors has already expressed their
skepticism on the helm of the government given the connections to cronyism and
corruption within their ranks. This is a major concern for potential investors as it is a way
to ensuring that those with tight grips with the politicians will gain favor at the expense of
others.

And lastly, poverty. The Asian Development Bank has noted that poverty leading to
conflicts and social disorder due to inequality will hamper investments and destroy social
capital. Simply put it, investors may lose grip in their business if the workers decide to
turn against them as a response to widespread poverty in the country.