How Duterte’s ICC Case Affects the Philippine Economy & Business Landscape

The recent transfer of Former President Rodrigo Duterte to the International Criminal Court (ICC) in The Hague has sent shockwaves through the Philippines. While much of the discussion focuses on political implications, the economic and business impacts are just as critical. How will this development influence foreign investments, business confidence, and key sectors such as construction and real estate?

Economic Fallout and Investor Confidence

Foreign Direct Investments (FDI) and Business Sentiment

Political stability is a fundamental driver of business growth, and Duterte’s ICC case has intensified uncertainty among investors. Many multinational companies and foreign investors assess political risks before committing capital, and with the Philippines under international scrutiny, potential effects include:

• 📉 A temporary slowdown in FDI as investors evaluate the country’s long-term stability.
• 💰 Higher investment risk premiums, meaning businesses may demand better returns before investing.
• 🌏 Shifting interest toward other ASEAN markets, such as Vietnam and Indonesia, which may be perceived as more stable alternatives.

However, some investors may see this as a step toward stronger governance, reinforcing the rule of law and attracting those who prioritize transparency and political stability.

Impact on the Philippine Peso and Stock Market

Financial markets react strongly to political turbulence. If Duterte’s case leads to prolonged instability or large-scale protests, the Philippine peso could weaken due to increased risk perception. Likewise, the Philippine Stock Exchange (PSE) might experience:

• 🔻 Short-term volatility, as market confidence wavers.
• 🔄 A correction phase, with cautious trading among institutional investors.
• 📈 Potential long-term stabilization, if the Marcos administration reassures markets and maintains economic momentum.

Effects on the Construction & Real Estate Sector

Public Infrastructure and Government Spending

• 🚧 The Build, Build, Build program under Duterte was heavily reliant on both domestic and foreign funding. Any decline in investor confidence could slow ongoing projects.
• 🏗️ The Marcos administration may double down on infrastructure projects to maintain economic stability and reassure developers.

Real Estate Investment and Property Demand

• 🏢 Political uncertainty can dampen property demand. If businesses and expatriates perceive risks, there may be a slowdown in commercial and residential property sales.
• 📈 However, some developers may seize opportunities by acquiring land at lower prices, banking on long-term economic recovery.

Marcos Jr.’s Strategy: Balancing Politics & Economic Stability

President Marcos Jr.’s decision to allow Duterte’s extradition was likely influenced by multiple factors, including:

1. 🌍 Strengthening International Relations – Aligning with the U.S. and EU on governance and human rights could open doors to trade incentives, economic aid, or better credit ratings.
2. 📊 Economic Positioning – Distancing from Duterte’s controversial policies may help Marcos Jr. present the Philippines as a stable, investor-friendly destination.
3. ⚖️ Long-Term Stability vs. Short-Term Disruption – While political tensions rise in the short term, Marcos Jr. may be betting on long-term economic benefits by reinforcing legal and governance institutions.

What This Means for Businesses & Investors

The economic and business landscape in the Philippines will depend on how well the Marcos administration manages stability and investor confidence. Key takeaways for businesses include:

• ⚠️ Exercise short-term caution: Expect fluctuations in the peso, stock market, and overall investor sentiment.
• 🌟 Look for long-term opportunities: If Marcos Jr. successfully reassures global markets, economic benefits could outweigh initial political risks.
• 🏘️ Monitor real estate and construction trends: Developers should assess shifts in land values and investor confidence before making major moves.

While political developments unfold, business leaders and investors must remain adaptable, assessing both risks and opportunities in this evolving economic landscape.