Chief Economist & Political Strategist, CrossASEAN Research

Prasenjit K. Basu

PK Basu has 34 years experience covering Asia's economies and markets (equities, fixed income and currencies), including 20 years covering the global economy. He was Chief Economist (SE Asia & India) at Credit Suisse First Boston for 5 years, and Chief Asia (x-Jpn) Economist at Daiwa Securities for a similar period. Among other roles, he was global head of research at Maybank Kim Eng, Malaysia equity research head and chief ASEAN economist at Macquarie, Chief Economist at ICICI Securities, ASEAN economist at UBS and the first chief economist at Khazanah Nasional (where he was co-head of research, and led all agri-business initiatives). PK Basu started his career in the Asia Service of WEFA (Wharton Econometrics) in Philadelphia in 1990, rising to be Director of their Asia Service in June 1994. 
PK's book, "Asia Reborn: A continent rises from the ravages of Colonialism and War to a New Dynamism" won the Tata Literature First Book Award (non-fiction) for 2018. It is the first single chronicle of the modern economic and political history of the whole of Asia (from Iraq and Turkey to Korea and Japan, and everything in between), told from an Asian perspective.

Chief Economist & Political Strategist

Duterte's Pivot to China Isn't Paying Off, as China's Expansionism Continues Unabated

REAL-Economics.com

Macroeconomics

After 15 years of conservative economic policy under two illustrado presidents (who each had a parent as president), the Philippines will now have its Communist Party represented in Cabinet for the first time, via the Cabinet Secretary, and the Secretaries for Agrarian Reform, Labor &amp; Employment, and Social Welfare &amp; Development. Like Estrada in 1998, Duterte inherits a robust economy, but it could quickly deteriorate if leftist populism runs amok in the next 3 years. We advise extreme caution. Although the fiscal deficit has widened slightly to PHP201bn in the year to March 2016, the current account remains in surplus (as it has for most of the past 12 years), but has shrunk in the past half year. Aided by a surge in government and private spending in the runup to the elections, real GDP accelerated to 6.7% YoY growth in the half-year ending March 2016 despite a positive real policy rate of 2.5% (among the world's highest). The latter will support the Peso in the early months of Duterte's term.But President Duterte's plans for spreading the fruits of economic growth more widely will require more government spending, and so could any plans for successful agrarian reform (unless he plans to expropriate hacienda owners without any compensation, which will bring a Congressional backlash). Estrada's less ambitious social spending in 1998-2001 (under Diokno, the same man who will be Duterte's Budget Secretary) caused a People Power revolt in 2001. Duterte's aggressive plans to fight corruption are also likely to strain his fragile coalition in Congress (where it is dependent on Marcos-era allies like Eduardo Cojuangco and Bong Bong Marcos).While the prospects for national reconciliation with the NPA and Moros are better under Duterte than under any previous president, his presidency is likely to be a rocky one, especially in the early months. The Philippines has been a pole of macroeconomic stability in Asia over the past 5 years, but is likely to be significantly less so in the period ahead. Stay Underweight the Philippines until this Administration can demonstrate an ability to balance its many contradictions.

After 15 years of conservative economic policy under two illustrado presidents (who each had a parent as president), the Philippines will now have its Communist Party represented in Cabinet for the first time, via the Cabinet Secretary, and the Secretaries for Agrarian Reform, Labor &amp; Employment, and Social Welfare &amp; Development. Like Estrada in 1998, Duterte inherits a robust economy, but it could quickly deteriorate if leftist populism runs amok in the next 3 years. We advise extreme caution. Although the fiscal deficit has widened slightly to PHP201bn in the year to March 2016, the current account remains in surplus (as it has for most of the past 12 years), but has shrunk in the past half year. Aided by a surge in government and private spending in the runup to the elections, real GDP accelerated to 6.7% YoY growth in the half-year ending March 2016 despite a positive real policy rate of 2.5% (among the world's highest). The latter will support the Peso in the early months of Duterte's term.But President Duterte's plans for spreading the fruits of economic growth more widely will require more government spending, and so could any plans for successful agrarian reform (unless he plans to expropriate hacienda owners without any compensation, which will bring a Congressional backlash). Estrada's less ambitious social spending in 1998-2001 (under Diokno, the same man who will be Duterte's Budget Secretary) caused a People Power revolt in 2001. Duterte's aggressive plans to fight corruption are also likely to strain his fragile coalition in Congress (where it is dependent on Marcos-era allies like Eduardo Cojuangco and Bong Bong Marcos).While the prospects for national reconciliation with the NPA and Moros are better under Duterte than under any previous president, his presidency is likely to be a rocky one, especially in the early months. The Philippines has been a pole of macroeconomic stability in Asia over the past 5 years, but is likely to be significantly less so in the period ahead. Stay Underweight the Philippines until this Administration can demonstrate an ability to balance its many contradictions.   

Philippines: Prepare for a Radical Leftward Shift in Policy