The World Bank has retained its three-year economic growth forecasts for the Philippines, but stressed these projections can be exceeded if the government can ramp up its infrastructure spending as planned and provide clarity on its economic policies.
The rate of the country’s economic growth may exceed forecasts in the next two years as long as the government could further ramp up public spending as planned by the Duterte administration, said the World Bank. “The Philippines remains one of fastest growing economies in East Asia and the Pacific despite the weak global economy.”
Upon assuming office, the Duterte government reassured investors and the private sector with continuity of existing macroeconomic policies including fiscal, monetary and trade policies that would support continued economic expansion and poverty reduction.
Domestic demand will power the Philippine economy to one of the fastest growth rates in Asia, even as external factors and President Rodrigo Duterte’s tough talk aided an outflow of foreign funds from the equities market, an economist said Tuesday.
“At the moment, the Philippines is the best performing country in Asia. It is still extremely dynamic,” he said, adding, “The outlook looks very favorable.” Rajic Biswas, Asia Pacific chief economist at IHS.
In its October update on the domestic economy titled “Outperforming the Region and Managing the Transition,” the World Bank said the country has weathered the challenging global economy and grown at a rapid pace over the past five years, “supported by strong macroeconomic fundamentals and a highly competitive workforce.”
In a briefing, World Bank lead economist Birgit Hansl said the completion of the 2017-2022 medium term development plan for the country is expected to provide investors with direction.
Hansl said that while the country’s macroeconomic fundamentals remain strong, the government should also pay attention to microeconomic reforms such as improving the ease of doing business in the Philippines to sustain growth.