Find out why Wilson Sy thinks a weak peso ain’t really a bummer
Most people might think that the economy is headed for a cliff with the peso slumping to its lowest in 11 years at 50.82 to the dollar last week.
But Bilyonaryo Wilson Sy is not like most people because his panic button is still bubble-wrapped in its acid-free case.
For the Warren Buffet of the Philippines, the peso’s swoon can be traced to factors that hardly paint a gloomy future for the economy.
Sy said people were buying dollars to buy more cars ahead of the anticipated tax hike and more steel and capital goods for the roads, bridges, and trains President Rodrigo Duterte planned to build under his term.
He said most of the dollars going out of the country were from fixed income investments of foreign managers. “In contrast, the stock market has benefited from foreign inflows. Year-to-date, net foreign buying in the stock market has amounted to P19.8 billion,” said Sy in his Philippine Star column.
If you zoom out your currency chart currently locked in at one year, Sy said the peso’s movement was just in line with the gyrations of other Asia currencies in the last three to five years.
Basically, people should not lose sleep over a weak currency and Sy gives us nine reasons why this could be a good thing for the economy:
1. OFWs and their relatives will have more peso to burn
2. Call center agents and other BPO employees will be more affordable than their Indian counterparts
3. Exports will get a much needed price boost
4. More expensive imports will lead consumers to look for alternatives
5. More incentives to revive factories
6. Local farmers will have more buyers
7. Going to Boracay and Palawan will be cheaper for foreigners
8. Create more jobs
9. Promote countryside development
Sy pointed out that these reasons all jibe with the Duterte’s economic agenda. So, what’s not to like?