Economists are predicting that the shutdown of the US government – which happened after the deadlock between Democrats and Republicans in Congress – is going to affect the Philippine economy significantly, if the current situation remains the same for a while. On September 30, 2013, the White House has instructed the closure of government offices in the United States, after the House of Representatives in the US led by Republicans did not manage to get Senate’s approval of a spending bill.
Cid Terosa, the economist from the University of Asia and the Pacific said, “If the shutdown will prolong it will definitely affect the exports and investment in the country”. The shutdown of government offices is going to have major consequences, as it will force over a million workers in the US to an unpaid leave, as well as close down many government agencies.
Terosa also stated that, due to the shutdown, economic and business activity in the country will decrease, which will in turn have an impact on the US export and investment activities across the world. The economist went on to say that the impact is expected to be significant, as the US is a big trading partner and it also has huge investments in the Philippines.
Analysts also said that the domestic economy’s strength is expected to offer some support to the local stocks’ performance.
Photo Credits: Yahoo
