Asia abounds with glowing opportunities

by Roulee Jane F. Calayag

The vestiges of the "giant hit" wrought by the global economic recession may soon be a thing of the past for Asia.After weathering the gloomy recession that threatened to cripple the world's financial systems two years ago, Asia-a roaring regional economic tiger-is cruising its way to recovery.

Chinese news agency Xinhua reported that Manila-based Asian Development Bank (ADB), in its economic publication, titled "Asian Development Outlook 2009", noted that the "quick and decisive response" of governments in the region to the global downturn had alleviated the impact of recession in Asian economies.

The bank's report, released on September 23, said: "Almost every large economy in developing Asia has implemented measures to stimulate aggregate demand through fiscal and monetary expansion."

Such a decisive approach redefined Asia's reaction to recession and made the region's economies resilient in the face of surmounting challenges-a fillip that saved the day for this emerging economic force.

Xinhua quoted ADB Chief Economist Jong-Wha Lee as saying: "Despite worsening conditions in the global economic environment, developing Asia is poised to lead the recovery from the worldwide slowdown."

ADB's pronouncement strengthens the view of economic analysts that Asia abounds with glowing opportunities-not that it is completely free from the contagion wrought by the recession but that it is on the track to recovery. This outlook puts Asia in an enviable position to spread its economic net.

Asians, particularly Filipinos, should be encouraged by this development and must shrug off undue fears by seizing opportunities that will allow them to lay the ground for a successful future, such as taking insurance policies and investing at the same time.

More than ever, now is the time to prepare for the future.

Pru Life UK's Finance and Investment Committee, in a commentary last August,  wrote: "Despite standing on solid economic fundamentals, the Philippine financial market was not insulated from the turmoil which pre-occupied global markets in 2008. The local equities market index opened the year at 3,626 and closed on the last trading day of the year at 1,873, ignoring the fact that gross domestic product (GDP) and gross national product (GNP) grew at respectable 4% and 6% respectively during the same period. Furthermore, the local financial market did not appreciate that our balance of payments account stood at US$1.7 billion even after portfolio outflows of US$758 million due to continued resilience in overseas Filipino workers' (OFW) inward remittances. On the inflation front, although the average rise in 2008 prices at 9.3% was well above that of the previous year of 2.8%, the ability of an emerging market like the Philippines to hold the average inflation rate within single digits against the backdrop of skyrocketing commodity prices (i.e. food and energy) should say much of the stability of its economic infrastructure. This has allowed for continued stability in benchmark interest rates, which averaged around 6%.

"The peso-dollar exchange rate depreciated from 41.15 to 47.52 over the year on the back of exiting foreign portfolio investments notwithstanding that a weaker exchange rate should bode well for an OFW remittance-driven economy.

­"Recovery has commenced in 2009 and although it cannot be ascertained as to when the markets will return to its peaks in 2007, the 32% increase in the Philippine Stock Exchange index (PSEi) from 1,873 to 2,468 on the last trading day of June 2009 should be a testament to this momentum. Economic fundamentals continue to remain on sound footing with GNP at 4.44% during the first quarter of 2009 and average inflation for the first half falling to 5%, which has allowed for all-time low overnight interest rates. Growth should be further supported by continued OFW remittance inflows, expansion in the Business Process Outsourcing (BPO) sector and calibrated fiscal spending, leading up to the elections in 2010. This presents a valid case to re-enter the market at this opportune time, albeit in a gradual and regular basis." Given this clear scenario, should Filipinos then need further convincing to "re-enter the market"?

Experts have spoken and authorities such as the ADB confirmed that Asia, which clearly includes the Philippines, stands to gain more from the ongoing economic recovery. This should serve as strong impetus for everyone, especially for financial consultants, to bring the good news of security and protection that insurance offers, to millions of Filipinos who are still uninsured.

As a trusted life insurer, Pru Life UK is of international pedigree, backed by the outstanding history and credibility of its parent, London-based Prudential plc.

Credit ratings firm Standard & Poor's (S&P) noted in its latest report that Prudential, specifically Prudential Assurance Company (PAC) and Prudential Annuities Ltd. (PAL) which are rated AA, remains the best rated insurer with its "very strong competitive position, resilient and diversified operating earnings profile, and very strong financial flexibility".

Prudential's Asian operations also made it to the 77th place in the prestigious Wall Street Journal's survey of Top 100 multinationals doing business in Asia for 2009. The award was the most recent addition to recognitions heaped on Prudential Corporation Asia this year, which included the 2009 Reader's Digest Trusted Brand Awards: "Asia" Gold Awards for Insurance and Investment Fund Categories and the 2009 Asia-Pacific Frost & Sullivan Awards: Healthcare Insurance Company of the Year.

With Prudential's outstanding track record even through gloomy times, it is imperative for members of Pru Life UK to leave no stone unturned.