Philippines not yet growth ‘outperformer,’ but still a ‘very recent accelerator’

THE PHILIPPINES fell short on being an economic “outperformer” among emerging markets, according to a discussion paper from McKinsey Global Institute (MGI) which nevertheless noted that the country’s rapid growth in recent years signals its potential to be so in the medium to long term.

MGI classifies “outperformers” as economies with an average of at least 3.5% annual per capita gross domestic product (GDP) growth over 50 years or five percent annual growth over 20 years.

In its latest report, MGI found that Association of Southeast Asian Nations (ASEAN) accounted for eight of the 18 developing countries in the category. Notable were Indonesia, Malaysia, Singapore, Thailand that grew above 3.5% in 50 years, as well as Cambodia, Laos, Myanmar, and Vietnam whose economies expanded by at least five percent in 20 years.

“While the Philippines did not meet either (criteria), its recent rapid growth could lift it to the ranks of outperformers in the future,” the report read.

It said the Philippines could grow at an average of 5.3% annually from 2015 to 2030, faster than the ASEAN forecast average of 4.1%, and faster than current outperformers, with Vietnam estimated to grow 4.9% annually in 15 years; Malaysia, 4.3%; Indonesia, 4.2%; Thailand, three percent and Singapore, two percent.

Latest state data show that the Philippines’ GDP grew 6.3% last semester versus 6.6% in 2017’s first half.

MGI described the Philippines as a “very recent accelerator”

“After several decades of strong and sustained economic growth, members of the Association of Southeast Asian Nations (ASEAN) make up almost half of the world’s best-performing developing economies. The challenge for the region is to maintain its growth momentum-and continue narrowing the per capita GDP gap with high-income countries-in changing times marked by rapid technological advances and demographic shifts,” it said.