The Asia-Pacific region likely remained one of the fastest-growing regions in the world despite the improvement of developing markets that is pushing capital back to countries like the United States.
The Philippines, for its part, is seen keeping in stride with the region’s expansion due to an ongoing construction boom in the real estate and infrastructure sectors, which may have been enough to offset the devastating effects of Supertyphoon “Yolanda” in the Visayas.
In a report, the World Bank said the Philippine economy likely grew by 6.9 percent in 2013, near the top end of the government’s 6- to 7-percent target range.
“Despite the damage caused by the natural disasters, output in the Philippines is estimated to expand,” the multilateral lender said in its Global Economic Prospects report released this week.
The World Bank added that growth in remittances likely expanded in November and December of 2013 as migrants sent home more money than usual to aid in reconstruction efforts in the Visayas.
“Remittances expanded by an estimated 5.8 percent in 2013 and will likely accelerate in the wake of the typhoon,” it said.
Countries that export products and services like the Philippines are also expected to benefit from improving conditions in advanced markets4.
The country’s growth was slightly slower than the expected average for the Asia-Pacific region of 7.2 percent for 2013, pulled up by heavyweight China, which likely expanded by 7.7 percent last year.
For 2014, the region’s growth is expected to slow “insignificantly” to 7.1 percent. The forecast for this year is more than double the projected expansion for the global economy of 2.4 percent in 2013 and 3.2 percent this year.
The Bank noted that after several years of weakness, advanced economies, particularly the United States, Japan and the eurozone, have started to show signs of sustainable recoveries. As a result, the bank said 2014 would likely mark a turning point for the global economy, with growth expected to accelerate for the first time since the 2008 financial crisis.
Asia’s growth, the multilateral agency said, would be slower by 2 percentage points than pre-crisis levels, mainly reflecting China’s plans to shift to more inclusive economic policies that focus on empowering its middle class at the expense of high and investment-driven expansion.
In 2015, the Philippines’ growth is expected to peak at 7.1 percent due to the effects of reconstruction efforts in the Visayas, which is expected to fuel demand for construction goods in the affected areas.—Paolo G. Montecillo