Understanding the Global ASEAN Consumer

Transcription

1 Understanding the Global ASEAN Consumer The Philippines Millennials Roberto B. Tan Treasurer of the Philippines February 2015

2 ASEAN Offers a Future of Prosperity and Stability Combined GDP of nearly USD3tr Over 600mn consumers Robust growth outlook ASEAN World Advanced Economies United States Euro Area Emerging Markets China Emerging Europe Latin America Source: International Monetary Fund Collectively, ASEAN s combined GDP places 7 th worldwide with slightly higher national income than Brazil % Share to Global GDP (2013) United States 21.8 China 11.6 Japan 8.3 Germany 4.7 France 3.6 United Kingdom 3.4 ASEAN 3.1 Brazil 3.1 Source: ASEAN 2

3 ASEAN: Consumer Profile ASEAN GDP per capita (PPP, current) US$7,526 US$8,163 US$9,187 US$10,166 Global brands are here: Rapidly declining extreme poverty (% of total population): 2000: 14% vs. 2013: 3% By 2025, consuming class will expand to 125mn households Broad consumer trends: leisure activities, modern retail, increasing brand awareness 22% of ASEAN s population live in cities of more than 200,000 inhabitants Urban areas account for more than 54% of the region s GDP Home to 3 of the World s Most Confident Consumers in the World Increasingly moving online Mobile penetration of 110% & Internet penetration of 25% Make up the world s second-largest community of Facebook users Sources: McKinsey, International Monetary Fund, Nielsen 3

4 PH: Strongly Positioned for the ASEAN Economic Community Real GDP Growth (%) ASEAN 5 Thailand Vietnam Malaysia Indonesia Singapore Philippines Average Contribution to Broad-Based PH Growth (%) Consumption Investment Government Net Exports Sources: International Monetary Fund, Philippine Statistics Authority Agriculture Industry Services 4

5 Sustained Growth Translates to More Jobs and Higher Incomes Indicator Ave 2010 Ave 2011 Ave 2012 Ave 2013 Ave 2014* Oct 2013** Oct 2014** Labor force ( 000) 38,893 40,006 40,426 41,022 40,051 40,397 41,322 Employed ( 000) 36,035 37,192 37,600 38,118 37,309 37,793 38,839 Wage and salary workers (% share to total employment) Unemployment rate (%) GDP Per Capita (US$) 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1, average GNI per capita (PPP basis) (LHS) GDP per capita (PPP basis) (LHS) GNI per capita growth (labeled, %, RHS) Source: Labor Force Survey, Philippine Statistics Authority *The average estimates for 2014 exclude Region 8. Moreover, average estimates for wage and salary workers are computed using the January 2014 data (which exclude Region 8) and April-October 2014 (which exclude Leyte). **Due to T phoo Yola da s devastatio, esti ates for O t. e lude Le te; for o para ilit purposes, O t. esti ates also exclude Leyte. 5

6 PH in 2015: Entry Into the Demographic Window Opens Opportunities for Sustainable Growth Japan Hong Kong Singapore Korea China Thailand Indonesia Vietnam Malaysia India Philippines Demographic Windows in Asia Average GDP Growth Rate for First 10 Years in Demographic Window (%) Has been in the demographic window for at least 10 years Has been in the demographic window for less than 10 years China Korea Japan Singapore Hong Kong India Vietnam Indonesia Malaysia Thailand For nations that have not yet been in their demographic windows for 10 years, the figure is an average of their growth rate for the time in the window Source: UN World Population to 2300, UN World Population Prospects, IMF World Economic Outlook 6

7 PH Consumers: Tech Savvy and Social Media Oriented Population 100mn Internet Penetration 37% Mobile Penetration 105% 3 rd Most Confident Consumers in the World Philippines Digital Landscape Social network sites viewed 15 billion times 45% go online every week 65% interact with brands via social media Average Daily Time Spent Accessing the Internet 81% are active Facebook users 6 hours through Desktop/Laptop 4 hours through Mobile Devices 32% are on Twitter 51% are active YouTube users Source: Global Web Index, Nielsen Survey, Ihub Media, International Telecommunications Union 7

8 PH Fiscal Flexibility: Sufficient Fiscal Space for Investing in Human Capital 3.7 Fiscal Deficit/GDP (%) Jan-Sep General Government Debt/GDP (%) Jan-Jun 2014 Source: Department of Finance 8

9 Stronger Fiscal Finances and Well-Targeted Spending Allow Higher Investments in Social Services % g.r. from Health Budget (PHP bn) Education Budget (PHP bn) % g.r. from Investing in People Improving health access and quality Sin Tax Reform Law (RA 10351) Responsible Parenthood and Reproductive Health Act of 2012 (RA 10354) Strengthening access to education and training for life skills Kindergarten Act of 2012 (RA 10157) Enhanced Basic Education Act of 2013 (RA 10533) Act Strengthening the Ladderized Interface Between Technical-Vocation Education and Training and Higher Education (RA 10647) PHP2bn budget for Technical Education and Skills Development Authority (TESDA) Expansion of social protection Conditional Cash Transfers (CCTs) National Health Insurance Program Source: Department of Budget and Management 9

10 Stronger Fiscal Finances Allow PH to Accelerate Infrastructure Development Key Budgetary Sectors as percent of GDP Infrastructure Outlay (as percent of GDP) 6.0% 5.0% 4.0% 3.0% 2.0% 4.0% 3.5% 2.5% 2.2% 5.1% 1.0% 0.0% (Projected) (Projected) Source: Department of Budget and Management 10

11 Investment Opportunities in PH Investment Opportunities Growth in Net FDI among fastest in Region Manufacturing IT and BPO Tourism Agri-business PH MY ID TH SG VN r/ Q1 -Q r/ NA Infrastructure 11

12 Growth Outlook for 2015 and 2016 NEDA Board- Development Budget Coordination Committee (as of Jan. 7, 2015) Philippine Development Plan Update (as of Jan. 2014) 2015 (projected) 2016 (projected) GDP growth (%) IMF Forecast WB Forecast Inflation, CPI (%, 2006=100), average Exchange rate (PHP/US%) Budget deficit (% GDP) Unemployment rate (%) Underemployment rate (%) Poverty incidence (%) Drivers of growth in the near to medium term Supply side Manufacturing Construction and logistics International and domestic tourism Wholesale and retail trade Business Process Management (BPM) fueling growth in real estate Agribusiness Demand side Investment: public construction, including infrastructure and reconstruction; private construction Household consumption: remittance inflows, strong consumer confidence Exports of services: good prospects on BPM External trade conditions: low world price of oil Source: Department of Budget and Management, National Economic and Development Authority, IMF s World Economic Outlook Update (Jan 2015); WB s Global Economic Prospects (Jan 2015) 12

13 Understanding the Global ASEAN Consumer The Philippines Millennials Roberto B. Tan Treasurer of the Philippines February 2015