“Hey, if it’s good for business, it’s good for us,” has always been the motto of Goldman Sachs Group.
And the US investment bank feels Rodrigo Duterte, the President-elect of the Philippines, is going to be good for business. It doesn’t matter that that brash 71-year-old who comfortably won the presidential election on May 9, is a vulgarian who vowed to ruthlessly crush crime and corruption by threatening to kill 100,000 criminals and feed their bodies to the fish in Manila Bay. All that matters is he could be a boon to the economy.
After recent meetings in Manila, Goldman’s analysts concluded Duterte’s mandate to boost infrastructure spending, cut red tape for business and invest more in farming could lift the country’s potential growth rate. Not that the Philippines are doing poorly. It already has one of the best performing economies in the world and its first-quarter growth of 6.9% exceeded China’s.
Under outgoing President Benigno Aquino the country won its first investment-grade sovereign rating.
“We believe that these proposals, provided they are successfully implemented, could further brighten our already positive macroeconomic outlook for the Philippines,” Matthieu Droumaguet, an economist at Goldman, wrote in a report.
In the Manila meetings, Goldman representatives were told Duterte was “decisive” with “a strong political will,” yet also “keen to delegate.”
Goldman said the Duterte’s promised policy mix should stoke business confidence and, over the medium term, could raise the economy’s potential expansion rate, and pose upside risks to the bank’s medium-term forecasts, reported Bloomberg.
“His incoming administration sketches an economic agenda conducive of market-friendly growth-oriented policies, which are likely to continue to fuel the secular growth story of the Philippines,” the bank said. “The cabinet formation, optimism of the business community and early pronouncements are all indicative that the upcoming administration will conduct growth-oriented and business-friendly policies.”
Goldman said it expects the economy to grow 6.7%, and increase to 7% early in the next decade fueled by investment, demographics and productivity.
Duterte is scheduled to take office on June 30.