MANILA: The Philippines’ economic growth which weakened to a three-year low in 2018 will rebound this year, boosted by spending for the May mid-term elections and helped by moderating prices, the nation’s chief economist said.

“With the declining inflation, domestic demand will strengthen,” Economic Planning Secretary Ernesto Pernia said in an interview in his office on Friday. Hitting the low-end of the 7% to 8% growth target this year is “good enough” and can be done, he said.

The fastest inflation in almost a decade in 2018 has started to moderate and isn’t expected to flare up this year, Pernia said. Accelerating prices held back growth and prompted the central bank to deliver one of Asia’s most aggressive rate hike cycles last year. Gross domestic product expanded 6.2% in 2018, the weakest pace since 2015.

Spending for the mid-term elections on May 13, when more than 18,000 national and local positions are up for grabs including half the 24-member Senate, can add one to two percentage points to this year’s GDP expansion, Pernia said.

The five elections in the past 14 years showed a spike in growth as politicians spent on food and drinks, transportation and mobile phones on the campaign trail. GDP growth jumped to 7.6% in 2010, the year Benigno Aquino won the presidency and was at 7.1% in 2013.

Those were the fastest growth rates since 1976.. — Bloomberg

Source: https://www.thestar.com.my/business/business-news/2019/01/28/chief-economist-elections-to-fuel-philippines-2019-growth/#gD13q2dxw1xh8uWe.99