Bailout and Philippines Real Estate Boom

The mortgage-related problems causing the present US financial crisis can provide a few lessons for the Philippines, which is still in the midst of a real estate boom.

In fact, housing sales in the country starting heating up about the same time as the US real estate boom, and to this day is still one of the world's hottest markets.

The big difference between the Philippines and real estate in the United States and Japan, which also suffered from an earlier industry meltdown, is that homes and even many larger real estate purchases are most often purchased with cash.

Banks and other lending institutions are much less involved in this market. Many homes, in fact, are not only payed in full but often in advance even before the building project has started.

Therefore, unlike and Japan and the US were a real estate bust also greatly impacted the financial industry, there is much less of the same type of exposure in the Philippines.

However, lately there has in a significant increase in the number of people buying homes and other real estate simply for investment purposes. These investors are more inclined to dump their property at any sign of a housing slowdown that would depress prices.

The government could take measures to control such possibilities by limiting speculation in the real estate market.

Philippines takes measures to buoy economy

After experiencing its fastest economic growth in many years during 2007, the Philippines is expected slower but still healthy growth this year due to the skyrocketing inflation.

Rising fuel and food prices in the Philippines are part of a global crisis due to the high cost of oil and the hoarding of rice and other grains.

For the first time in a decade, Manila will put off trying to balance the budget in favor of providing subsidies to alleviate the surging fuel and food costs.

Philippine foreign reserves are at a record $37 billion due to massive foreign investment and remittances and the privatization of a power plant. The government is looking toward new technologies to help with the food crisis. Hopefully though, it will not get lured into the dangers of biotechnology and genetically-modified foods.

One area it is known to be researching are ways to alleviate the environmental impacts of aquaculture.

Another recent project is the "Zero Garbage" initiative that encourages households to compost and plant their own gardens, and community gardens to supplement their food stocks, help clean the air locally and reduce the burden on the local government in disposing of mountains of garbage.

Mon Jul 7, 8:51 PM ET

Commuters queue outside a train station in Manila in this June 16, 2008 file photo. Increasing numbers of Filipinos are leaving their cars at home and taking public transport to ease the burden of soaring fuel costs. As inflation soars in the Philippines and gasoline prices climb relentlessly, more and more commuters in the capital are squeezing into suburban trains and public buses, putting an enormous strain on the services. To match feature PHILIPPINES-INFLATION/TRANSPORT REUTERS/John Javellana/Files

(PHILIPPINES)

Geothermal Energy could sustain Indonesia and Philippines

Interesting news report on geothermal energy, particularly in the Philippines and Indonesia.

Analysts believe countries in the so-called Pacific "ring of fire" could derive enough energy to fully power their domestic economies. But there are high costs involved, and tapping into "volcano power" is potentially fraught with danger.

One of the responses by Mario Marasigan, head of the Energy Utilisation and Management bureau at the Philippines Department of Energy, though illustrates one of the problems in developing this resource.

The main issue that besets our renewable energy development, particularly geothermal, is the huge upfront cost that is required for any development of geothermal resources. The cost of drilling one hole during the exploratory stage of resource development will take a lot of investor requirement. You know for Filipino investors, to come up with the huge investment cost for geothermal energy development is a little difficult. So it would take a multinational corporation to develop these kind of resources.

Here again is a typical situation of a developing country waiting for external sources to develop its basic infrastructure. I have no doubt that the Philippines, both business and government sources, could pony up the money to finance these projects if the will was there.

More opinions on geothermal and other sources of renewable energy for Southeast Asia can be found Global Voices Online.

No Signs of Survivors from Princess of Stars

Rescuers found no signs of survivors from the ferry accident in the Philippines. The mishap of the Princess of Stars involves the same shipping company, Sulpicio Lines, responsible for the three worse Philippine maritime disasters and the deadliest non-wartime shipping accident, the wrecking of the Dona Paz, in history.

Calgary Herald

Hopes Fading for Philippine Ferry Survivors New York Times - Jun 23, 2008 By CARLOS H. CONDE MANILA - Hopes faded on Monday for more survivors in what could be one of the Philippines's worst sea tragedies as rescuers failed to find any sign of life inside a capsized ferry that had held more than 800 passengers and crew ... Video: Hundreds Still Missing After Ferry Capsizes AssociatedPress Typhoon heads to China after deadly strike in Philippines CNN International