PDP-Laban 'infighting' cuts PH political risk score, boosts chances of opposition for 2022 win

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Metro Manila (CNN Philippines, September 13) — The tension between the two warring factions of the PDP-Laban has weighed down the country's business environment, and at the same time, increases the chances of the opposition to win the presidency next year, think tank Fitch Solutions said.

The group said it scaled down its short-term political risk index (STPRI) score for the Philippines from 64.8 to 64 out of 100. The STPRI "assesses pertinent political risks to investment climate stability over a shorter time frame, up to 24 months forward," it said.

It said lowering the score reflects its expectations for disruptions, adding that this will further be slashed if the Philippines faces delays in the passing of the 2022 national budget.

"We at Fitch Solutions view the infighting within the Philippines’ governing PDP-Laban party ahead of 2022 elections as detrimental to the country’s near-term policy-making outlook," Fitch Solutions said.

"With the two camps at loggerheads over leadership of the party and who should receive party backing for the presidential and vice-presidential elections, there is a risk that policy making processes will slow as attention is turned to political jostling rather than measures to speed up the Philippines’ economic recovery from the COVID-19 pandemic and longer-term reforms," it said.

READ: Comelec: No need yet to intervene in PDP-Laban rift

Officials of the PDP-Laban have been on a head-to-head battle -- ousting officers from the rival faction and claiming they are the legitimate party officers.

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Energy Secretary Alfonso Cusi leads one PDP-Laban faction, while Senator Manny Pacquiao heads the other.

The faction led by Pacquiao named Senator Aquilino "Koko" Pimentel III as party chairman, replacing President Rodrigo Duterte.

The Pacquiao camp said in late August that the lawmaker may pursue his plan to run for president next year. The Cusi-led faction, on the other hand, officially endorsed the tandem of Senator Bong Go and Duterte as its presidential and vice presidential bets for the 2022 elections.

"Political distractions and infighting within the governing coalition could hamper efforts to reopen and support the economy. Focus will likely shift away from the need to boost the Philippines’ vaccine uptake rates and address supply issues, while we highlight the potential for delays to the passing of the 2022 budget before year-end," Fitch Solutions said.

"Longer-term reforms that would benefit the next president could also stall. These include proposed reforms to ease restrictions on foreign ownership in the utilities and retail sectors, as well domestic hiring requirements, which could be key to reinvigorating investor interest in the Philippines," it added.

According to Fitch Solutions, the conflict within the ruling party also opens an opportunity for the opposition to secure the top post.

"The infighting within PDP-Laban raises the prospects for opposition candidates winning the presidency," it said.

Senator Panfilo Lacson and Senate President Vicente “Tito” Sotto III have confirmed their intention to run as president and vice president, respectively, in the 2022 elections.

Vice President Leni Robredo, meanwhile, has yet to make a decision.