Page 4 - SEPTEMBER 2017 B ISSUE

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PH SLIPS IN HUMAN CAPITAL RANKING
MANILA – The Philippines has
remained among East Asia and the
Pacific’s top 10 economies in terms
of human resource development,
according to an annual report of
the World Economic Forum that
nevertheless showed the country
slipping in regional and global ranking,
weighed down by challenges in skills
application and accumulation through
work.
The World Economic Forum’s
Human Capital Report 2017 showed
the Philippines slipping to ninth place
in East Asia and the Pacific from eighth
spot last year, with a global rank of 50th
out of 130 countries and a score of
64.36 on a scale where 100 is the “best”
mark, down from 49th spot — also out
of 130 economies — with a 71.75 grade
in the 2016 roster.
The Philippines’ score fell below East
Asia and the Pacific’s 65.77 average
this year, but bested the region’s 69.75
grade last year.
China, which ranked 11th in East
Asia and the Pacific and 71st globally
last year with a score of 67.81, broke
into the region’s top 10 this year,
dislodging Vietnam (now 64th globally
with a score of 62.19) from the group
and jumping over Mongolia (10th in the
region and 51st globally with a 64.35
grade), the Philippines and Thailand
(eighth in the region and 40th globally
with 66.15) to land seventh spot in the
region and 34th globally with a 67.72
grade.
The index ranks 130 countries on
how well they are developing their
human capital on a scale from 0 (worst)
Consumer confidence slips amid continuing crisis in Marawi
MANILA – Filipinos grew less
optimistic in the third quarter amid
increasing concern on the unresolved
conflict in Marawi City, alongside
expectations of higher expenses, low
incomes, and strong rains, the results of
a recent central bank survey showed.
The latest Consumer Expectations
Survey (CES) saw that some 10.2%
of Filipino families are upbeat about
economic and financial prospects
between July to September, slipping
from the record-high 13.1% posted in the
previous quarter.
The Bangko Sentral ng Pilipinas
(BSP) conducted the poll among 5,597
families between July 1-15, which weighs
the number of Filipinos optimistic versus
those pessimistic of local economic
conditions, and of their family’s financial
situation and income.
Still, the net confidence index
was the second-highest seen since
the quarterly survey started in 2007.
Optimism remained in positive territory
since the third quarter of 2016 or when
President Rodrigo R. Duterte assumed
office. Prior to that, quarterly net
confidence scores were negative, which
BUSINESS & FINANCE
to 100 (best) across four dimensions,
namely: capacity, deployment,
development and know-how, and five
age groups: 0–14 years; 15–24 years;
25–54 years; 55–64 years; and at least
65 years old.
“It can be used as a tool to assess
progress within countries and points to
opportunities for cross-country learning
and exchange,” the report explained.
The “capacity” subindex measures
gains in education; “deployment” covers
skills application and accumulation of
skills through work; “development”
quantifies efforts to educate, train and
upgrade the skills of students and the
working-age population; while the
“know-how” subindex “captures the
breadth and depth of specialized skills
used at work”.
Measured against these subindices,
the Philippines placed:
• 19th with a score of 78.8 in terms
of capacity, which covers literacy and
numeracy, as well as primary, secondary
and tertiary education attainment;
• 60th with 65.7 in terms of
development, covering primary,
secondary, tertiary and vocational
education enrolment; quality of primary
schools; quality of education system;
skill diversity of graduates and extent of
staff training;
• 60th with 52.3 in know-how,
covering share of medium and
highly skilled workers, availability
of skilled employees and economic
complexity (which measures degree of
sophistication of a country’s “productive
knowledge” as shown in the quality of
its exports);
A man works the grocery
aisle in file photo
showed that more residents were doubtful
of local prospects.
Optimism slipped due to the occurrence
of calamities during the quarter – which
covers the rainy season – as well as
concerns on the peace and order situation
due to the unresolved conflict in Marawi
City left some Filipinos jittery.
The fighting in Marawi has left 133
soldiers, 65 civilians, and 614 rebels killed
as of Aug. 28, according to Malacañang.
Thousands of residents have also fled to
• 87th with a grade of 60.6 in terms
of deployment, covering labor force
participation rate, employment gender
gap, as well as unemployment and
underemployment rate.
Sought for comment, Labor
Undersecretary Joel B. Maglungsod,
whom the administration of President
Rodrigo R. Duterte had plucked from
the leftwing labor movement to serve
in government, said that while the
current government’s P8.44-trillion
“Build, Build, Build” infrastructure
development program may help
improve human resource use in the
Philippines, it is “temporary” and not
“strategic in nature” when it comes
to developing human capital “[k]
asi pagkatapos ng (because after)
infrastructure and construction (is
completed), wala na(development and
other cities and are living in evacuation
centers as the military pursues its offensive
versus the Maute Group to recover the city
in Mindanao.
The respondents also attributed their
less favorable outlook to expectations of
higher prices of goods and services, low
or no increase in incomes, more jobless
Filipinos, and poor health.
Rosabel B. Guerrero, director of BSP’s
Department of Economic Statistics, said
consumer outlook weakened across income
September 2017 / Fortnightly – No. 18 • UK & Europe Edition
BusinessWorld infographic on how the Philippines fared in the Human Capital Index
use of human resource ends).”
“We really need to develop
agriculture and our manufacturing
sector, as well as processing of raw
materials in mining for instance,” Mr.
Maglungsod said partly in Filipino and
English, referring to the administration’s
intention to end the export of metal ore
and develop local processing capability.
“In order to establish economic
stability, you also have to stabilize
workers in their employment, because
workers are the primary force of our
economy,” he added in a telephone
interview, citing the need to tighten
restrictions on contractual hiring of
workers.
The World Economic Forum noted
in its report that “[a]t a global level,
only two (regions) — North America
and Western Europe — have developed
groups, particularly for Filipinos living in by 6.5% during the second quarter, picking
the provinces.
The confidence index for low-income
households even slipped to negative
territory amid expectations that they will
not see any salary increase during the
quarter, with pessimists outweighing the
optimists.
Families also do not see themselves
making big-ticket purchases this quarter,
as they instead focused on buying food
and other basic needs over acquiring cars,
homes, and other high-value items.
Despite the slide in consumer optimism,
BSP Deputy Governor Diwa C. Guinigundo
said he still expects a pickup in consumer
spending during the quarter, which in turn
will support robust economic growth.
“The CES is still very much positive.
That means household consumption…
will remain resilient and relatively
robust compared to previous years,” Mr.
Guinigundo said during a press briefing on
Friday.
Some 13.9% of Filipinos remain positive
about the country’s economic condition,
down from the 26.6% tallied during the
second quarter.
Gross domestic product (GDP) expanded
more than 70% of their human capital
versus the ideal score.”
“Three regions — Eastern Europe
and Central Asia, East Asia and the
Pacific and Latin America and the
Caribbean — score in the 60-70%
range, while the Middle East and North
Africa, South Asia and Sub-Saharan
Africa have yet to cross the 60%
threshold.”
In East Asia and the Pacific, “[t]
he gap between the best and worst
performers is among the largest of any
region, reflecting in part the different
stages of economic development of the
16 countries covered in the index, as
well as the varying degrees of human
capital development that exist between
countries with similar income.” n Elijah
Joseph C. Tubayan, BusinessWorld | September
14, 2017, 4:43 PM
up from the 6.4% pace logged during
January-March and approaching the
government’s 6.5-7.5% growth goal for the
entire year.
Families broadly expect commodity
prices to keep rising but at a measured
pace, while interest rates are likewise seen
to keep an upward trend. Meanwhile, the
peso is expected to continue to depreciate
versus the dollar over the year ahead.
On the other hand, more families
supported by overseas Filipino workers
opted to use their money on food,
education, and investments. Those
deploying the remittances on savings
slipped to 42.1% from 45.9% the previous
quarter, the BSP said.
Consumers were generally more
upbeat about prospects during the fourth
quarter as they expect higher salaries and
more jobs, along with improved security
conditions as they see the Marawi conflict
resolved soon.
Net optimism climbed to 17.8% for
the fourth quarter coming from 13.6%
previously, which was observed across all
income groups. n Melissa Luz T. Lopez,
BusinessWorld | September 10, 2017, 11:42 AM