The country may have to wait a year for the benefits of various public-private partnership (PPP) infrastructure projects to kick in, according to the DBS Group.
“A widely expected boost to investment growth in the form of PPP projects did not materialize in the first half [of 2011],” DBS said. “As such, instead of being a 2011 story, PPP has become more of a 2012 story.”
In its latest quarterly report on the global market, the Singapore-based group said growth momentum for domestic output would also depend on the recovery of overseas demand for Philippine exports.
As bidding for PPP projects may take place in the fourth quarter, capital formation may pick up toward the end of 2011.
Also, growth in construction activity will more likely be felt the following year, the group added.
State economic officials, including Finance Secretary Cesar V. Purisima, have hinted that at least one tollway contract and up to five major projects may be up for bidding this year.
DBS also expects more foreign direct investments to come this 2011 because the second-quarter inflow of P40.6 billion was three times the figure reported in the same period of last year.
“With indications that the government is taking a more active role in attracting foreign funds, investment commitments and realization should remain strong,” DBS said.
Also, DBS believes that external demand for Philippine goods will be the key swing factor in economic growth, even though the global electronic market has yet to pick up.