CAPITAL MARKETS AT RCEP’S CORE

The capital markets will be one of the beneficiaries of the Regional Comprehensive Economic Partnership since it will generate “investments in sectors such as e-commerce, manufacturing, research and development, financial services and information technology”.

Vietnam is forecast to benefit from its RCEP-covered agriculture and fisheries products as well as footwear. automobiles and telecommunications. Malaysia with its ratification of the RCEP agreement to be realized by March 18, 2022, "banking on greater opportunities in travel, tourism and the aviation industry, is expected to increase its GDP between 0.8% and 1.7% through the RCEP”.

The Philippine’s "market capitalization accounted for 88.6% of its Nominal GDP in Dec. 2020, compared to 85.6% in the previous year”. As of Oct. 2021, “PSEi recorded a monthly P/E ratio of 22.7”.

Forbes Asia has named the Philippines as one of the top South East Asian IPO markets: with Thailand at $3.3B at the first slot, the Philippines, no. 2 at $2.3B, followed by Indonesia at $2.1B, Malaysia at $800M and Singapore at $600M.

Just between the second half of 2021 and the first month of 2022, there have been about 16 active companies at the Philippine Stock Exchange from IPOs to FOOs to additional listings, PDRs etc.

More IPO listings will follow in the capital markets from those who have taken the lead.

Axelum, the country’s leading fully-integrated manufacturer and exporter of world-class premium coconut products, is one example of a home-grown enterprise that grew all the way to being in a position to go on an IPO last September 2019. Its major export markets are the United States, Europe, Australia and Asia which comprise 90% of total sales.

We were privileged, decades ago, to have created its main brand ID - Fiesta - and helped Axelum with its IPO. Moving forward, Axelum Resources Corporation according to the Business World “recorded a 44.5% increase in its net income for the third quarter of 2021 to P260.27M as a result of higher net sales which increased during the July-September period by 23.4% to P1.69B from P1.37B YOY”.

From domestically produced virgin coconut oil, another company was listed at the Philippine Stock Exchange – Keepers Holdings Inc., this time in the business of distributing imported liquor. Backed by Mr. Lucio Co’s Cosco Capital Inc. and its tremendous success in the retail markets such as his Puregold Price Club and the S&R Membership shopping outlets, Keepers Holdings has a “74% market share based on the volume of imported spirits distributed in the Philippines”, according to the Inquirer’s Doris DumlaoAbadilla, adding that it completed “a P4.5B FOO which elicited a strong demand from retail investors”.

The sum total of RCEP’s benefit for Asia, according to the borgenproject.org, is to help the impoverished together with the ASEAN. The productive output of those in the capital markets will help, in the end, the poverty situation like in the Philippines where it is needed most with a poverty incidence at 23.7% in 2021. The RCEP members’ trade deal, which account for 30% of all global gross domestic product will impact on more than two billion people.