Domestic demand sustained the strong economic growth of countries in the East Asia-Pacific including the Philippines, according to Bangko Sentral ng Pilipinas (BSP).
“The region’s growth has remained strong and this was underpinned by domestic demand with further support of intraregional trade,” BSP Governor Amando Tetangco Jr. said.
Tetangco explained that as far as growth is concerned, domestic demand has been the principal driver and this demand has been supported by favorable macroeconomic conditions.
“Growth is continuing, inflation has remained low and stable and banking system has also remained stable,” he said.
The BSP governor added that domestic demand has also been bolstered by diversification of trade activity from the traditional markets, meaning the US and Europe, to greater trade within the region and other emerging economies.
He noted that intraregional exports in the region rose by 50 percent in 2012 from 44 percent in 2000, while trade to emerging markets went up by 28 percent in 2012 from 17 percent in 2000.
Furthermore, Tetangco said that the trade of the region has shifted to markets that are experiencing sustained economic growth.
“Demand from these markets has continued to be strong even as demand from the United States and Europe has slowed down,” he stated.
The BSP governor also said that the shift has helped in bolstering economic growth among East Asia-Pacific countries.
These observations, according to Tetangco, was the outcome of the 18th Executives’ Meeting of East Asia-Pacific Central Banks (EMEAP) recently held in Kuala Lumpur, Malaysia.
The EMEAP is where central bank governors in the region shared their views on the ongoing uncertainties in the global economic environment and expressed their optimism on the resilience of these economies.
EMEAP is a group of central banks from Indonesia, Malaysia, Philippines, Singapore, Thailand, Japan, Korea, China, Hong Kong, Australia and New Zealand.
“This is relevant because a great part of the discussion was focused on what is happening on the global economy as well as in the global financial system and how that has affected the economies in the region including the Philippines,” the BSP governor said.