World Bank: Philippines will continue to be region’s fastest-growing economy
MANILA, Philippines — Despite some “stabilization” of investment growth, the Philippines will continue to be the fastest-growing economy in Southeast Asia, the World Bank said on Tuesday.
In an update of its twice-yearly economic report, the World Bank said the Philippines’ potential growth accelerated to around 5-6 percent in 2013-17.
That was more than a percentage point above the longer-term average rate, the Bank said.
The Washington-based multilateral lender likewise expects the country’s economy to grow 6.7 percent in 2018 and 2019, before clocking a tad slower growth rate of 6.5 percent in 2020.
The Bank’s forecasts, however, were below the government’s gross domestic product growth target range of 7 percent to 8 percent for the next three years.
Meanwhile, the Philippines will likewise see a rise in working-age populations and could enjoy a demographic dividend if they generate sufficient jobs.
Despite these improvements, the World Bank said Manila continues to face “vulnerabilities” in its financial sectors, with fast credit growth.
The Bank also reported that investment growth declined from earlier record-high rates in the Philippines, as front-loaded investment spending eased.
The World Bank last month upgraded its economic growth forecast for the Philippines to 6.7 percent from the previous estimate of 6.6 percent “to reflect recent economic trends.”
“If investment growth accelerates faster along with increased spending in public infrastructure, economic expansion can be even higher in 2017 and 2018 and exceed the current projection of 6.7 percent,” said Birgit Hansl, World Bank Lead Economist for the Philippines.
The country’s GDP registered a solid 6.9 percent growth rate in the third quarter of 2017, putting the economy on track to meet the government’s 6.5-7.5 percent full-year target.
The government will announce the 2017 fourth-quarter and full-year GDP performance on January 25.