ADB raises Philippine forecast
THE ASIAN Development Bank (ADB) has raised its forecast for the Philippines anew, putting fullyear 2016 gross domestic product (GDP) growth at 6.8% in the wake of strong third-quarter expansion to cement the country’s position among the region’s fastest-growing major economies.
ADB country economist Aekapol Chongvilaivan said the regional lender recently hiked its estimate for Philippine economic expansion after a 7.1% gross domestic product (GDP) growth last quarter. The latest projection, he said, will be reported next month.
“The higher forecast is due to the third quarter, when growth was much higher than expectation. It is partly because export performance is actually better than expected, and this is supported by a weakening peso during the third quarter,” Mr. Chongvilaivan said on the sidelines of the Business-World- Philippine Airlines ASEAN Regional Forum yesterday at the Conrad Manila hotel in Pasay City.
The new GDP forecast is higher than the 6.4% forecast given last September that compared to an initial 6% projection for 2016, and edges closer to the top end of the government’s 6-7% growth goal for the year.
Growth has averaged 7% in the nine months to September, well
above 2015’s 5.9% clip and already at the top end of the full-year official target.
Growth is seen to ease this quarter from the July- September pace — which was the fastest since the 7.9% recorded in 2013’s second quarter — although the full-year average is expected to remain among Asia’s fastest.
“By the fourth quarter, we expect that growth will be slightly going down due to an uncertain global economy and the fact that capital investments — though still at a very high level — it will tame a little bit. That’s why we calibrate and expect a slight decline in capital stock and a stable trade deficit,” the ADB official said.
Mr. Chongvilaivan likewise said that the ADB raised its 2017 growth outlook for the Philippines to 6.4% from 6.2%, that in turn was also up from an original 6.1%, although the rate is slightly below the government’s 6.5-7.5% target for next year.
Hence, the latest upgrades mark the third upward revision for the year, coming from the original 6% and 6.1% projections for 2016 and 2017, respectively, under the Asian Development Outlook 2016 report which ADB released in April.
ADB’s earlier 6.4% GDP growth forecast for the Philippines this year matches those given by the International Monetary Fund and the World Bank last September.
“With overall modest growth in ASEAN, the Philippines is a bright spot in the dark,” Mr. Chongvilaivan said during the forum, noting that the Duterte government is “on the right track” in pursuing the President’s 10-point socioeconomic agenda that both continues and builds on reforms of past administrations.
In a speech on Wednesday, Bangko Sentral ng Pilipinas Governor Amando M. Tetangco, Jr. said the Philippines can be expected to sustain its rosy growth story, backed by ample buffers against external shocks, sound policies and firm macroeconomic footing.