MANILA – An economist of ASEAN+3 Macroeconomic Research Office (AMRO) said the Philippine economy is expected to post a 6.3 percent growth in 2019, despite the slide in the first quarter.
This is slightly lower than the institution’s 6.4 percent earlier projection, which AMRO chief economist Hoe Ee Khor attributed to the unexpected slowdown in the first quarter due to effects of the late approval of the 2019 national budget.
Growth, as measured by gross domestic product (GDP), in the first three months this year slid to 5.6 percent from the previous quarter’s 6.3 percent.
In a briefing at the Bangko Sentral ng Pilipinas (BSP) office in Manila on Wednesday, Khor said the first quarter growth development is expected to be one-off” since it was due to the budget impasse.
“We didn’t expect first quarter to be so weak but despite the very weak first quarter we expect the economy to bounce back,” he said.
Khor explained that they revised their growth projection for the year because of the budget delay’s impact, but pointed out that since full-year growth is forecast to remain strong “that means next quarters will relatively be strong in order to average at 6.3 (percent)”.
“And then for the following year to continue to recover,” he said.
AMRO’s growth projection for this year is within the government’s revised growth target band of between six to seven percent.
Khor also said that the government’s infrastructure program is certain to boost the domestic economy.
In terms of the impact of simmering trade issues overseas, Khor said it is forecast to affect Philippines’ growth by around 0.06 percent.
“By and large, I think the economy has not been affected as much as we feel. And we hope that it remains that way,” he added.
Inflation is seen to average at three percent this year and the next, the mid-point of the government’s two to four percent target band until 2020.
Rate of price increases rose to 3.2 percent last May from month-ago’s three percent while the five-month average stood at 3.6 percent. (PNA)