By Joann Santiago
MANILA, (PNA) — The Philippines is expected to remain resilient amid the latest external headwind – the partial shutdown of the US government given the impasse on the passage of the Federal budget.
Finance Secretary Cesary Purisima, in a statement, said the Philippines’ strong fiscal position and current account position along with the consumption-driven growth and young and educated population are expected to buoy the domestic economy.
These factors, he said, “will allow the Philippines to ride out this situation better than other emerging markets – whose economic models are exports and extractives-based.”
“What is more worrisome to the Philippines is if the US political stalemate cause America to default on its debt by failing to pass a measure on the debt ceiling,” he pointed out.
Purisima said it was “unimaginable” for the world’s largest economy to default on its liabilities.
He, however, said this is “now in the realm of the possible because of current political circumstances.”
If this materializes, the Finance chief said this “can only lead to unprecedented chaos in the global financial markets.”
He said this situation “is highly unfortunate for the rest of the world, as even countries like the Philippines are taken on a wild economic ride because of the political game of chicken in Washington.”
He noted that “the US enjoys a level of global political power as the world’s largest economy and the holder of the global reserve currency.”
Thus, “I hope that the political leadership in Washington also recognizes their global responsibility, as their domestic disputes now carry ramifications across the world,” he added.