Philippines Growth Forecast Raised

Following faster-than-expected gross domestic product expansion in the third quarter, the World Bank has raised its growth forecast for the Philippines to 6.7%.

In a statement, the Washington-based multilateral lender said the upgrade from the previous projection of 6.6% was made “as part of its quarterly forecast exercise to reflect recent economic trends,” Reuters reported.

“Following a stronger-than-expected growth of 6.9% in third quarter and a revision of GDP growth for the second quarter, from 6.5 to 6.7%, the World Bank projects 6.7% growth for 2017,” it said. The revised 2017 growth forecast remained within the government target range of 6.5-7.5%.

The World Bank retained its 2018 growth projection for the Philippines of 6.7%, still below the government’s 7-8% yearly target until 2022.

“Continued global economic recovery gaining steam has led to higher than expected export growth for the Philippines and an encouraging upturn for the third quarter of 2017,” World Bank lead economist for the Philippines Birgit Hansl said.

“The simultaneous recovery in major advanced economies and in developing economies is boosting global trade. For the Philippines, it means stronger import demand from the country’s main trading partners, such as the United States, Japan and Europe,” the World Bank said.

Moving forward, “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%,” Hansl said.

In October, the World Bank cut its growth forecasts for the Philippines for both 2017 and 2018 due to “slower than expected” implementation of public infrastructure projects so far.