World Bank Retains Predictions Of Growth For The Philippines

The World Bank has stated that the Philippines is expected to continue its growth trajectory despite a slowdown in the economies of surrounding countries and pointed out that the Philippines was only behind China and Vietnam in terms of growth prospects.

In its latest Developing East Asia and the Pacific Economic Update, the World Bank has retained the growth projections for Philippines.

Stating that it will grow at 6.4 percent this year, at 6.2 percent the next year and at 6.2 percent in 2018.

In a statement, Karl Kendrick Chua, senior economist at the World Bank Philippines said

The projected faster growth in 2016 will be led by robust private consumption, aided by low inflation and spillover from increased spending due to the upcoming general elections

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According to Chua the implementation of key projects including private sector and public private partnership (PPP) projects would support the economy’s growth. He said that the subsequent slowdown was due to normalization after the election cycle. Chua also stated that the growth in the country was now becoming more inclusive in nature. He said that such growth needed to be sustained for the poorer sections of the country to experience the benefits from higher growth.

The World Bank however highlighted the fact that further reforms in the country was needed to accelerate growth, pointing out areas such as the country’s tax system, telecommunications and rice sectors which were in need of urgent reforms.

Overall the World Bank reduced its forecasted growth for the developing East Asia region. The agency dropped growth projections from 6.5 percent in 2015 to 6.3 percent in 2016 and 6.2 percent for the year 2017-18.

This decline has been attributed to the shift in China’s strategy, moving the focus away from exports to domestic consumption. The World Bank has also projected that China will grow by 6.7 percent in 2016 and by 6.5 percent in 2017, declining from its growth of 6.9 percent in 2015.

Apart from China, the region’s developing countries saw a growth of 4.7 percent in 2015. The World Bank has said that growth will improve slightly to 4.8 percent next year and 4.9 percent in 2016-17 as a result of growth in the larger Southeast Asian economies.

According to Victoria Kwakwa incoming World Bank East Asia and Pacific Regional Vice President, the region accounted for over two-fifths of the global growth occurring in 2015. The region is expected to continue driving global growth despite a challenging global scenario with weak global trade, dropping commodity prices and general slowdown across major economies.

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