Political, Legal, and Regulatory Risks

Political, Legal, and Regulatory Risks

The Philippines country risk analysis strategic planning consists of economic, political, and financial systems and has high levels of risk. The trade figure for 2010 where as follows exports is at $50.7 billion and imports is at $61.1 billion for the Philippines region (Bureau of East Asian and Pacific Affairs, 2011). In 2010 in the Philippines the gross national product (GDP) was $188.7 billion, annual GDP growth rate was 7.3% (Bureau of East Asian and Pacific Affairs, 2011). The Bureau of East Asian and Pacific Affairs (2011) website states that "The Philippine economy has proved to be well-equipped to weather recent global financial crisis because of the country's efforts over the past few years to control the fiscal deficit, reduce debt ratios, and adopt internationally-accepted banking sector capital adequacy standards."

According to Bureau of East Asian and Pacific Affairs (2011), " The Philippines economic growth depends on agriculture, natural resources, textiles, pharmaceuticals, wood products, paper products, tobacco products, beverage manufacturing, food processing, transport equipment, electronics, fishing, business process outsourcing services." The islands also have significant mineral and natural gas reserves that boost the economy. This region remains flexible to the global economic downturn.

Political risks for the Philippines comes from the threats from terrorist groups, domestic insurgencies, political parties, and security issues negatively impact the Philippines ability to attract much needed foreign investment. To combat these issues the Philippines has become apart of the Association of the Southeast Asian Nation also known as ASEAN. ASEAN consist of Indonesia, Malaysia, Myanmar, Philippines, Singapore, Cambodia, Laos, Vietnam, and Thailand. The ASEAN has contributed to the economic growth; social progression cultural development; diversification, and stability. Government involvement remains high in the financial system.

Exchange and Repatriation of Funds Risks

The Philippine Peso is the currency in Philippines. The Peso is divided into 100 centavos. The exchange rate for the Philippine Peso was last updated on September 20, 2011 from the International Monetary Fund. The conversion for 100 Peso's for the United States Dollar is $2.30. There are no restrictive regulations on repatriation of funds related to the foreign investments such as sales or divestment proceeds, profits, dividends, royalties, loan payments and liquidations. Proceeds will be sourced from the banking system. Investments in government need not be registered with the designated custodian bank

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