MANILA -- The depreciation of the peso is not bad for the Philippines, one of the country's economic managers said on Sunday.
Amid worries that the weak peso was hurting the economy, Budget Secretary Benjamin Diokno said several sectors stand to benefit from a weaker peso.
"For the nth time, as an economist, what we need is a competitive peso -- not a strong peso; a STRONG peso does not mean STRONG economy; nor does a WEAK peso mean a WEAK economy," Diokno said in a statement.
Diokno said families of overseas Filipino workers, the business process outsourcing industry, export-oriented industries and companies that manufacture and sell products that compete with imported goods all stand to gain from a weaker peso.
He added that the government would also benefit via higher revenues from import duties, which in turn would result in a lower budget deficit.
"The 'loser' are those who have foreign tastes (the Prada, Chanel, and Dolce&Gabbana crowd), those who travel abroad, and those who have a lot of foreign debt," Diokno said.
Diokno added that Japan, China and South Korea, deliberately weakened their currencies in order to reach first-world status.
The Budget chief also parried criticism that the weak peso was not really helping exporters.
He said that the effects of a weaker peso on export earnings would not be immediate, as there was a "built-in delay" by the nature of the business.
"Moreover, there is the element of seasonality. For example, goods for the Fall season are ordered two seasons before (by Summer)," Diokno said.
The peso is the second-worst performing currency in Asia as the Philippines' balance of payments deficit balloons as imports rise amid the Duterte administration's ambitious push to upgrade the country's infrastructure.
The dollar's appreciation has also been cited as a factor in the peso's slide.
From P49.93 to the dollar at the end of 2017, the peso closed
53.34 last Friday June 29.
While the weak peso has increased the local value of dollar remittances, some OFW families are complaining that rising inflation has been eating away the gains.
The peso's depreciation has also pushed the country's foreign debt higher.
According to the Bureau of Treasury, P32.38 billion was added to the national government's foreign debt at the end of May compared to the previous month as the peso continued to weaken versus the dollar.
Since the start of the year, the country's foreign debt has grown by P197.06 billion, the agency said.
Debt watcher Moody's Investor service has said that the weak peso is a "credit risk" for the Philippines as a large share of the country's debt is foreign currency-denominated.