MANILA -- Trade Secretary Ramon Lopez said confidence of investors in the country remains high even with the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) Act this year.
In an interview on Radyo Pilipinas’ Cabinet Report sa Teleradyo with Presidential Communications Operations Office Secretary Martin Andanar on Saturday, Lopez cited that the sustained strength of the Philippine Stock Exchange index (PSEi) during the last trading days in the stock market in 2017 until the first of 2018 reflected investors’ confidence in the country despite the new law already took effect.
He added that the PSE has kicked off the year with a record-level index.
During the last trading day of 2017, PSEi closed to an all-time high 8,558.42 points compared to its previous year’s index of 6,840.64.
On Friday, it sustained its rally ending the day with 8,770.00 points.
This is despite the TRAIN Act hiking stock transaction tax in the PSE to 0.6 percent from 0.5 percent.
“The confidence of our investors is sustained,” Lopez noted in Filipino.
He added that with more investors buying more stocks in listed companies, these firms are also expected to boost their businesses that will buoy the economy.
The trade chief said investors remain confident putting in investments here with the country’s strong economic growth.
He added that the robust manufacturing sector has pushed for expansion of production capacity of factories which means companies have to increase their employment. As more Filipinos become employed, consumer activity increases, which is one of the main drivers of the country’s strong economic expansion.
“You have consumer activity, you are attracting investments, you are creating job. So, it’s a virtuous cycle,” Lopez noted in Filipino.
Meanwhile, the DTI chief also dismissed claims of the Makabayan bloc at the House of Representatives that the TRAIN law is anti-poor and will cause burden with the increase in prices of goods and services brought by additional excise tax on petroleum products.
“Those remarks -- I would say, rhetoric -- have no basis,” Lopez said noting that the TRAIN law was being carefully studied by the government.
Earlier, the DTI said the new excise tax on oil and gasoline has minimal effect on inflation, which may increase prices of goods by less than one percent.
“This reform will further boost our economy,” Lopez reiterated. (PNA)