Its challenging to be optimistic in 2023

Every generation needs a revolution - an entrepreneurial revolution

Its a good idea to be optimistic and tough amidst the turmoil in 2023  But look around the external environment:

1.  Big banks in US and Europe failing  (3s in the States, CSB in Switzerland, Deutsche Bank next?)

     What follows, industries failing too?

2.  Europe and US are reported  to be in recession?

3.  The only way that Central Banks and US Feds can control inflation is to put the economy into

      recession -  lay offs so that the consumer will buy less;

4.  Big company closures in Japan:     Sharp, Toshiba, the scandal at Olympus cameras

     (It incurred big losses when it parlayed into stocks, and other unrelated non camera ventures; the

     only saving grace was the Olympus medical)

     Sharp company failure

     Inappropiate accounting procedures at Toshiba

     Japan's 20 year recession - ADB

     We are better off than Japan whose GDP growth was reported to be only 1%;  vs Philippines 6%

      Japan used to be our idol in the 1990s for growth innovation and management

Global job cuts, what can be done

Every generation needs a revolution - an entrepreneurial revolution

Nearly 200,000 jobs were cut in 2022;   about 100,000+ were announced by global companies like Meta, Amazon Accenture Paypal, etc.   Name the cause    cost cutting, P n L revenue decline, problem in Ukraine.

It is certainly a cause for worry for many.  Certainly this is a cure for inflation.  Fed and Central Banks efforts have been paying  off.

But this is a great difficulty for families for those who lost jobs   No food on the table, no more shelter (as we see among slum dwellers in Europe) and in streets of LA even at Philadelphia.

It could trickle down to BPO companies in the  Phil.  The cost cutting can cut into the outsourcing by Western companies  It means lesser jobs too for our OFWs.   The 6 - 7% GDP growth forecast for Phil could be overly optimistic

Its not an event that will force despair or suicide.  We need to think like entrepreneurs.  We can pose solution to this negative event.    We can think of new business, on how to cope up.

We need an entrepreneurial revolution to counter this global crisis

Philippines will be isolated and insulated from the world economic woes

Every generation needs a revolution - an entrepreneurial revolution

Bright future for the Philippines in 2023 - Diokno. From Philstar

Will Philippines be part of the world global recession?   All ready the tremors are spreading in Europe after a bank run in Switzerland, and soon Germany, bastion of EU economic strength

But my view and view of many is that Philippines will be unaffected by these events:

1.  We will be unlike Pakistan, who is soon to be predicted to be bankrupt  (we have a more stable leadership, BIR collect taxes)   Definitely not like Sri Lanka

2.  We will not experience the hyper inflation of Venezuela (we will soon if we continue being a welfare state, engage in war, or massive unabated infra projects)

3.  We willl not experience UK difficulties  ie that of inflation and woes brought about by Brexit  (Imagine happening to what used to be the richest countries in the world . This happens not only to countries but to individuals  This happened to a distant uncle who used to own two big major subdivision, could not even pay for his funeral.  His daughters and sons impoverished him

Philippines has large domestic population which can sustain consumer demand  Our monetary system is sound, fiscal policies are in place.  Despite occasional news about  corruption and crimes, our peace and order is way above the norm.   Our Pres has a high rating

What worries us is the huge foreign borrowings .  We have $100 B bank reserves though.  

If our BPO and OFW remittances hold out in 2023, we will not suffer.   We see huge cap ex outlay of many of the Zillionaires in the country   MVP for instance continues to buy hospitals, investment in health care.  

We have bright execs and expatriates who caused boom in Indonesia, Vietnam and rest of Asean.  

Everything will be bright and all right for the Philippines

2023 promises to be a challenging year for businesses

Every generation needs a revolution - an entrepreneurial revolution

Tougher times ahead in 2023. Manila Times

Difficult 2023 IMF

Its going to be challenging year 2023 for businesses. On the micro level, many businesses closed shop:   food outlet serving Ramen, coffee shops milk tea shops (hole in the wall type)  two big restaurants, bike shops   Many buko vendors and fruit vendors along Manila East road   

Challenging 2023 ahead of us

5 Changes in the Global markets

At the Macro level, there seems to be huge growth of 7.6% in 2022, but after discounting the inflation rate of 4%, we are left with nominal 3.6% not something to crow about   And if we compare the numbers to pre pandemic numbers, we were at the same level     Many big establishments are permanently closing   Even our airlines are heavily indebted  and could face financial downfall 

A slower growth, if any is expected in 2023   

A building supplier who went into airport business whose plant is nearby is reported to have difficulty meeting its payroll

The inflation, the high interest rate at US which drives down the Peso value vs the dollar, the high energy costs, the Ukaraine war, the China covid wildfire spread do not mean well for Philippine economy..

WE MUST WORK HARDER BE MORE INNOVATIVE BE MORE entrepreneurial    The telecon, the energy food too  travel sectors seem robust and steady.   Tourism,..?    The glamping bike tourism is on the way down.  Many sites priced themselves out of the market   We must engage in cost reduction, protecting our liquidity, focussing on sales and collection

We must be open to new opportunities,  and seek and screen them   All ready there are two projects that I must evaluate.  And trips to the provinces are plenty.  We are sewing one up and in the contract signing stage.  

Next week I will have a meeting with Puerto Princesa business men and we wil discuss possible projects

Doomsayer - world wide recession in 2023

Every generation needs a revolution - an entrepreneurial revolution

Many experts:   Robert Kiyosaki, banks (BoA) World Bank  many YT videos predict of impending world wide recession due to China problem with Covid, world wide inflation due to US Fed increase of interest

rates, impending illiquidity of big banks (due  to countries saddled with huge deficits and debt to to GDP ratio which incudes Japan and USA (over 100% - Phil at  60+ still looks healthy

We still do not know for sure how true these predictions are (but even Feng Shui experts seem to affirm that 2023 is going to be bad.)

But we must be resilient and dig in defensively:    hold on to commodities - gold and silver and  real estate.   Currency may be worthless   We can end up like Nigeria or Venenzuela  (In Venenzuela, a Big Mac cost millions)

https://www.worldbank.org/en/news/press-release/2022/09/15/risk-of-global-recession-in-2023-rises-amid-simultaneous-rate-hikes