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The Philippine economy in 2015 could grow by 6 percent, and even by as much as 7 percent, if vital investments in infrastructure were to be made within the year.
The UK-based bank Standard Chartered also expected the Bangko Sentral ng Pilipinas (BSP) to hike policy rates by 50 basis points in the fourth quarter of the year, as concerns over the global economy pushed other central banks to already tweak their rates.
In a press briefing on Friday, Standard Chartered economist for Asia Jeff Ng said the Philippines would remain “anchored” amid a “tempest,” as economies around the globe await a potential hike in US interest rates.
“We expect the Philippines to still outperform the rest of its Asean neighbors… It is a bright spot in Asia,” Ng said. “The Philippines is seen as a standout.”
Standard Chartered’s economic growth forecast for the Philippines this year, which is lower than the government’s projection of 7-8 percent gross domestic product (GDP) expansion, is underpinned on robust consumer spend ing, Ng explained.
“There’s a lot of scope for spending on non-necessity items,” he noted.
The higher end of Standard Chartered’s 6-7 percent forecast would be reached “if all investment projects come into fruition,” according to Ng.
For 2016, the bank expects the country’s GDP growth to be lower at 5.7 percent, as global oil prices are seen to normalize next year, affecting the country’s net exports, Ng said.
The Philippine government targets economic growth next year to also fall within the 7-8 percent range.
Another analyst expects the central bank to keep key policy rates steady for the rest of the year, as monetary authorities guard against rising consumer prices in the coming months.
“We expect the BSP will leave interest rates on hold until at least the end of the year,” Capital Economics, a think tank, said in a note to clients.