Davao Region MSMEs’ productivity improved thru DTI’s SSF projects

Fitch Solutions sees 50 bps hike in BSP key rates in May

Fitch Solutions sees another 50 basis points increase in the Bangko Sentral ng Pilipinas’ (BSP) key rates this May, noting projection for continued acceleration of domestic inflation and forecasts rate adjustments pause until end-2023.

Last week, the BSP policy-making Monetary Board (MB) hiked by 50 basis points the central bank’s key rates after citing further rise in the January 2023 inflation rate to 8.7 percent, a new 14-year high, which is a “surprise” that exceeded expectations of likely peak last December.

“Given still persistently high inflation, we now expect the BSP to continue raising interest rates to a peak of 6.50 percent in H123 (first half 2023),” Fitch Solutions said in a report sent to journalists on Monday.

It expects additional hike in the central bank’s key rate, saying this will be made “to tame inflationary pressures.”

“Beyond that however, a stabilization in global monetary conditions and headwinds to economic growth will give the BSP enough reason to leave rates on hold throughout the remainder of 2023,” it added.

The projection that BSP will keep its key rates steady in the second half of the year has been attributed to the eventual stabilization of global monetary conditions and the shift in the central bank’s priorities to again support the economy, which is expected to be negatively impacted by the persistent elevated inflation rate.

The report said core inflation, which excludes volatile food and oil items, also accelerated last January to 7.4 percent from month-ago’s 6.9 percent.

It traced the increase to a rise in utility prices as a result of electricity price hikes and the implementation of the water rate rebasing.

The report further said second-round effects, or the resulting effects of

The implementation of the Shared Service Facility (SSF) is dedicated to continuously aid in the development, design innovation, and overall competitiveness of the micro, small, and medium enterprises (MSMEs). Further, the program is seen to help them increase their productivity and maximize the marketability of their products.

Since the launch of its first project in June 2013, the Department of Trade and Industry (DTI) 11 has been consistently improving the productivity of 1,370 local entrepreneurs throughout the region, as of December 2022. DTI 11 was given additional funds amounting to Php3 million for the capital outlay during the latter part of 2022, of which six projects have been approved.

These six projects are scheduled for launch this year. With this, two have already been formally launched in Davao de Oro on January 24, through the signing of the Memorandum of Agreement (MOA) and Usufruct Agreement between DTIDavao de Oro and the two SSF cooperators, the Callawan Farmers Multipurpose Cooperative (CALFAMCO) in New Bataan and Barangay Baylo CoCoPal Farmers Association (BABACOFA) in Monkayo. The former has received an additional set of ma- chinery for garments production, while the latter’s equipment is for its cacao processing. Meanwhile, the one project in Davao City will be launched in March. This is the One Town, One Product (OTOP) packaging and labeling facility with the Food Processing Innovation Center (FPIC) as the host of the service hub located within the vicinity of the Philippine Women’s College of Davao (PWC).

DTI 11 Regional Director Maria Belenda Q.