ADB upgrades PH growth forecasts
Asian Development Bank (ADB) has slightly upgraded its Philippine economic growth forecasts for 2017-2018, citing higher public investment and rebound in exports as key drivers for the robust domestic economy.
Based on its updated Asian Development Outlook released yesterday, the Manila-based ADB is projecting that the country’s economy, as measured by its gross domestic product (GDP), would grow by 6.5 percent this year from 6.4 percent and 6.7 percent in 2018 from 6.6 percent.
ADB noted that higher public investment along with the rebound of exports boosted the Philippines’ economic expansion in the first three months of the year.
The country’s economy grew by 6.4 percent in the first-quarter, slower than market expectations but still among the fastest in the region, next only to China among major Asian economies.
For this reason, ADB said the Philippines along with Malaysia and Singapore will be the growth drivers in Southeast Asia.
“High growth in Malaysia, the Philippines, and Singapore is dampened somewhat by disappointing growth in Brunei Darussalam. Robust domestic demand, particularly private consumption and investment, will continue to support economies in the region,” ADB said.
However, the bank’s new GDP forecast for 2017 is at the lower-end of government’s economic growth target of 6.5 percent to 7.5 percent, while next year’s projection is below the 7.0 percent to 8.0 percent range set by the Duterte administration’s economic managers.
Meanwhile, ADB said that economic growth prospects in developing Asia have improved this year on the back of stronger-than-expected export demand in the first quarter.
ADB upgraded its growth outlook in the region from 5.7 percent to 5.9 percent in 2017 and from 5.7 percent to 5.8 percent for 2018.
The smaller uptick in the 2018 rate reflects a cautious view on the sustainability of this export push, ADB said.
“Developing Asia is off to a good start this year with improved exports pushing growth prospects for the rest of 2017,” Yasuyuki Sawada, ADB’s chief economist said in a statement.
“Despite lingering uncertainties surrounding the strength of the global recovery, we feel that the region’s economies are well-placed to face potential shocks to the outlook,” he added.
South Asia will remain the fastest growing of all subregions in Asia and the Pacific, with growth on track to meet original projections of 7.0 percent this year and 7.2 percent in 2018, according to the ADB report.
Growth projections for Southeast Asia, meanwhile, are expected to remain at 4.8 percent in 2017 and 5.0 percent next year.
The outlook for Central Asia this year has also improved as stronger domestic demand and exports in some countries have fueled an unexpected recovery in the subregion.