MANILA – Along with the rest of Asia, the Philippines stands to benefit from the Joe Biden presidency due to the expected reduction of risk from the US-China trade war, less protectionism and possible increase in government stimulus.
Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said in a report, the possible decline of trade war concerns could result in increased global trade and economic growth, especially in Asia.
Ricarfort said a lesser US protectionist stance could also benefit the Philippines’ imports, exports, remittances and business process outsourcing (BPO) sector. He said the US accounts for about 70% to 80% 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 additional US government spending the Democrats, to which Biden belongs, has been pushing, could result in better economic outcomes for the world’s largest economy and benefit its trade partners like the Philippines.
Ricafort said the Philippines is could also 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 government’s bond yields” amidst these factors.
Ricafort said recent changes may inspire the Philippines to adapt to these changes in the US, towards greater cooperation such as in obtaining assistance on Covid-19 vaccines, infrastructure, security, and defense locally and in dealing with the West Philippine Sea.”
He said “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.”