Connect with us

Hi, what are you looking for?

Top Stories

Editor's Pick

GDP to grow by 5.5% — GlobalSource


By Luz Wendy T. Noble, Reporter

THE PHILIPPINE ECONOMY will probably grow faster than expected this year, but elections next year and the growing inequality are risks to recovery, according to GlobalSource Partners, Inc.

The research consultant expects economic output to expand by 5.5% this year and in 2022, faster than the 3.5% estimate it gave in August. It is also better than the government’s 4-5% goal.

“We expect the unevenness in growth across income groups and industries reflecting firm and labor market scarring to continue and weigh on activity further out,” GlobalSource analysts Romeo L. Bernardo and Maria Christine Tang said in a report on Monday.

It would probably take until late 2022 for economic growth to go back to its pre-pandemic level, they added.

The latest forecasts presume that current vaccines will protect Filipinos from the Omicron coronavirus variant from South Africa, which scientists have said appeared to spread more than twice as quickly as Delta.

Elections for president and vice-president down to mayors must also be credible, the US-based consultancy said.

The high vaccination coverage in Metro Manila, the center of Philippine economic activity, would work to its advantage, it added.

More than nine million Filipinos in the capital region have been fully vaccinated against the coronavirus, according to data from the Department of Health.

“In this environment, we anticipate sustained growth in business process outsourcing, digital transformation and the resilience of remittances to support the economy’s recovery,” GlobalSource said.

But some provinces continue to have low vaccination rates. The Southeast Asian nation has one of the lowest vaccination rates, with just 41% of the population inoculated against the coronavirus.

The government seeks to fully vaccinate 54 million Filipinos by yearend.

GlobalSource expects Philippine economic growth to stay at 5.5% by 2022, which is below the state’s 7-9% target.

“There will be more uncertainty about sources of growth as poll-related spending disappears by midyear and focus shifts to questions of policy continuity under the new administration,” it added.

The economy expanded by 7.1% year on year in the third quarter, bringing the nine-month growth to 4.9%.

Gross domestic product (GDP) shrank by 9.6% last year, one of the worst in Asia and the Philippines’ deepest recession since World War II.

Meanwhile, GlobalSource expects inflation to hit 4.5% this year before easing to 3.5% next year.

It said the central bank would probably continue to support the recovery even as other central banks like the US Federal Reserve have started to reconsider their loose monetary policy.

“Comparing progress in economic recovery and health management at this time, we do not think that the Bangko Sentral ng Pilipinas (BSP) needs to follow the US lockstep, especially since the economy’s two growth engines, remittances and BPOs exports, will benefit from a weaker peso,” the consultancy said.

“However, depending on local growth outcomes and global financial market conditions at that future point, the BSP may also decide to take preemptive action and avoid what financial markets seem to fear, like belated, aggressive policy rate hikes,” it added.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Editor's Pick

The Board of Investments (BoI) has cleared Sinoma Energy Conservation (Cebu) Waste Heat Recovery Co. Inc. to serve as the operator of a 4.5-megawatt...

Editor's Pick

The world’s food-import bill is set to jump even more than expected to a record this year, increasing the threat of hunger, especially in...

Editor's Pick

Century Properties Group, Inc. has approved a P6-billion debt securities program, of which half of the amount will make up the first tranche including...

Editor's Pick

MORE FILIPINOS should become entrepreneurs to allow economic and technological progress amid the ongoing coronavirus disease 2019 (COVID-19) pandemic. Vince Dominic Yamat, managing director...

Disclaimer:, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice.
The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 Secrets Of Richdads. All Rights Reserved.