The Philippines was ranked as “most resilient to potential external shocks” among 21 countries considered as “emerging markets,” according to a report by the Center for Global Development, an international think tank based in Washington, D.C.
The “Emerging Market Macroeconomic Resilience to External Shocks: Today versus Pre-Global Crisis,” written by economist Liliana Rojas-Suarez, ranked 21 countries according to how each one is likely to fare in the event of a global economic downturn that could be triggered by a prolonged low inflation environment in Europe, as well as from a looming monetary policy normalization in the United States.
In ranking the countries, Suarez used seven “resilience indicators”: GDP; ratio of short-term external debt to gross international reserves; ratio of general government fiscal balance to GDP; ratio of government debt to GDP; inflation; and domestic liquidity.
Rojas-Suarez said that the Philippines posted a reduced external debt ratio, which fell from about 40 per cent in 2007 to around 20 per cent in 2014. She also cited the country’s improved performance in inflation.
The Philippines was deemed “highly resilient to adverse external shocks if the event does not result in a sharp contractions of economic growth, a severe decline in the rate of growth of real credit and/or the emergence of deep instabilities in the financial sector.”
The countries ranked include “Emerging Europe” (Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland and Romania) and “Emerging Asia” (China, India, Indonesia, South Korea, Malaysia, the Philippines and Thailand).
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