for the Philippine economy were darkening. The country’s combustible president, Rodrigo Duterte, had announced an immediate quarantine for the main island of Luzon and its 55m people. Bangko Sentral ng Pilipinas , the central bank, warned that the outlook was the worst since the Asian financial crisis of 1997-98. The currencies of other countries in the region were sinking as the world economy listed. But the peso barely budged .
did cut interest rates to keep credit flowing, which in normal times might have caused the peso to weaken. But Nicholas Mapa of, a bank, thinks foreign investors held on to Philippine assets because interest rates remain higher than in rich countries, yet the Philippines is seen as a safer bet than most other emerging markets.
In part that is because remittances, which keep the economy afloat, have held up quite well so far. They fell by only 3% in the first four months of 2020. Inflows can even increase during periods of domestic economic weakness, as the diaspora responds to distress calls from home. Gareth Leather of Capital Economics, a consultancy, points out that lots of Filipino expatriates work in health care, and so are likely to retain their jobs even as migrants working in construction, say, lose theirs.
The public finances have also been prudently managed in recent years. Fairly thrifty budgets combined with rapid economic growth have brought down the ratio of public debt tofrom more than 70% in the mid-2000s to less than 40% in 2019. Relative to the size of the economy, foreign debts are lower than in Malaysia, Indonesia or Thailand. TheBut the Philippines’ relative economic stability, and the buoyancy it has bestowed on the peso, are not unalloyed benefits.
This article appeared in the Asia section of the print edition under the headline "A milder infection"