Effects of US crisis on the Philippine economy

[giddyboy]

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Sun.Star Network Online - GSIS, SSS urged to disclose Lehman investment

"The Government Service Insurance System (GSIS) and the Social Security System (SSS) were urged to assure their members that they are not affected by the US financial crisis as a result of the collapse of Lehman Brothers."

Philamlife assures it is insulated from parent AIG's woes | ABS-CBN News Online Beta

"The head of the Philippine American Life & General Insurance Co. (Philamlife) assured its policy holders Tuesday that the troubles facing its parent firm, American International Group Inc. (AIG), will not affect the local operations of the insurance company."

Business - BDO says exposure to Lehman at $134M - INQUIRER.net

Banco de Oro Unibank said on Friday it had a total exposure of $134 million to bankrupt US investment bank Lehman Brothers, the biggest for any local bank.

Banco de Oro said earlier this week it had set aside P3.8 billion ($82 million) to cover possible losses in its investments with Lehman...

...Six other Philippine banks had a combined exposure to Lehman worth $252 million, bringing the total to $386 million, the Philippine Daily Inquirer said, citing documents from the central bank.

Should we panic? BDO, Metrobank, RCBC hit by Lehman collapse : PinoyMoneyTalk.com Philippines

At least three Philippine banks face possible loss of investments due to their exposure to bankrupt global financial services firm Lehman Brothers.

As Lehman Brothers filed for Chapter 11 bankruptcy early this week, local banks Banco de Oro (BDO), Metrobank, and Rizal Commercial Banking Corp. (RCBC) announced they have set aside provisions for possible write-downs ranging from P658 million ($14 million) to P3.8 billion ($80.7 million).

CAN WE SURVIVE THIS? Surely the question right now on depositors’ minds: Is there a reason to panic?

In the end, bank depositors right now have no reason to panic despite the potential losses their banks might have. But investors and stockholders have a reason to be afraid, because if the outlook of pessimism continues in the market, the declining stock prices as we have seen above may just keep on dropping.

[colossus]

I'd like to think we can survive the U.S. recession and its effects. There might be adverse effects but if we have efficient economic managers to plan our economic path, the adverse effects will be minimal.

We can survive this global trend. We have survived too many negative trends already. We had the oil crisis, the Asian financial crisis, and now, US recession. We should put this in mind but we should take it as a challenge.

[giddyboy]

i think this is a very big challenge to our economic managers. this is their time to shine or otherwise.

clearly, we are already seeing the effects of this global crisis. Depositors are getting worried. Plan holders too. Investors and stockholders are panicking. Exporters are temporarily (and some permanently) closing shop.

Stock markets all over the world are bleeding. even the US stock market is losing hard on its 6th day already.

and knowing our kind of local politics already, this is one of the best times the opposition and detractors of the current administration to make all sorts of stone-throwing, especially when 2010 elections are near.

[giddyboy]

RP stocks tumble to 26-month low
By Zinnia Dela Peña
Thursday, October 9, 2008

Share prices tumbled to 26-month lows as shockwaves from falling markets across the globe triggered massive sell-offs.

Dealers said the Philippine shares tracked the weakness in global markets and emerged 4.8 percent lower. The composite index fell 116.45 points to 2,307.74 points, while the all-shares index fell 3.99 percent to 1,472.74 points.

There were 14 gainers compared to 113 losers with 21 unchanged. Turnover totaled 2.408-billion shares worth P2.372 billion.

“We’re tracking Wall Street just like everybody else, hit by the nervousness exported by the US,” Lawrence de Leon of Accord Capital Equities told Dow Jones Newswires.

Investors largely ignored Tuesday’s Philippine consumer price index report, which showed inflation easing in September after hitting a 17-year high in August...

source:
Philippine Star - Articles - -

[ian_1983]

Any slowdown of the US economy will always have an adverse effect on everyone and not just the Phils. Our economy is so heavily dependent in the US market, in-fact about 20 percent of the countrys exports go directly to the US, while another 50 percent of the exports go to Japan, China, Hong Kong, South Korea, Taiwan, and Malaysia but these are actually components assembled into products that end up in the U.S. market as well. All these means that cuts on the U.S. export demand could be potentially devastating to 70 percent of the country’s exports.

Aside from this the U.S. market are the information technology-enabled industry and the business process outsourcing (BPO) sector. In 2005 these accounted for 90 percent of BPO export revenues and over two-thirds of foreign equity. Their will be less investment from overseas investors as they are bracing for the worst. Investors won't be that optimistic this time (as the biggest economy in the world is down). Another casualty would be tourism..last year alone 18% of the 3million travellers in the country are americans. less disposable income, less travel for the Americans. But how about the europeans, recently what is happening in tne europe is far more worse than US since a number of countires are already in recession.

As the saying goes..if the worlds biggest economy sneezes everybody catches a cold..but since now it has a fever i guess the rest got a convulsion. .