ADB KEEPS 4.5% GROWTH FORECAST FOR PH
Asian Development Bank (ADB) still expects the Philippine economy to grow by 4.5 percent this year given the country’s sustained infrastructure investments and as the mass vaccination drive picked up pace.
The ADB’s Asian Development Outlook (ADO) 2021 Update on Wednesday showed the same gross domestic product (GDP) growth forecasts for 2021 and 2022 as those in the last ADO which was released in April. For 2022, its growth forecast was kept at 5.5 percent.
ADB acting chief economist Joseph Zveglich Jr. told a press briefing that their forecasts for the Philippines in April “started with a much more conservative view of how the vaccine rollout would come through as well as the removal of containment measures, because the Philippines’ [quarantine] measures have been a bit more stringent than many of the economies in the region.”
The ADB’s 2021 GDP forecast is within the government’s downgraded 4- to 5-percent growth target.
The forecast for 2022, meanwhile, is below the government’s 7- to 9-percent target range.
Recovery still fragile
“The economy has regained its footing and is on the right growth path. But the recovery remains fragile due to the threat posed by more infectious COVID-19 variants. Vaccination remains key to the economy’s safe reopening. We are actively supporting the government’s efforts to achieve its national vaccination targets through our health-related assistance,” ADB Philippines country director Kelly Bird said in a statement.
According to the ADO Update report, the “periodically tighter COVID-19 mobility restrictions, particularly in Metro Manila” kept economic recovery fragile.
The ADB nonetheless pointed to an accelerated national mass vaccination program, such that the country was seen “making good progress toward meeting the government’s year-end targets.”
“The government forecasts that about 80 percent of the target population in Metro Manila will be fully vaccinated by the end of October, which helps improve the conditions for further easing of mobility restrictions that will help restore consumer and business confidence. With substantial deliveries of vaccines expected over the rest of this year, the vaccination rollout outside Metro Manila is expected to accelerate,” the ADB said.
The ADB also said public investment would remain a key driver of domestic investment. s,” the “Roads, bridges, expressways, ports and railways are among the major investment projects underway,” it noted.
However, the ADB said that “the main risk to the outlook is the spread of more contagious COVID-19 variants, leading to the reimposition of strict quarantines and stalling economic recovery.”