The Philippines will continue to post the fastest growth among emerging Asian economies this year, although the lack of election-related spending as well as external uncertainty may slow the momentum, UK-based Oxford Economics said.
“Excluding China, Japan and India, we expect the contribution of domestic demand to growth in Asia to rise to 3.4 percent from 3.2 percent in 2016, with overall GDP (gross domestic product) growth remaining stable. Within this grouping, the Philippines will continue to be the fastest growing economy, although we expect its growth momentum to moderate,” Oxford Economics lead Asia economist Priyanka Kishore said in the 2017 Regional Economic Outlook for Asia-Pacific report.
Across the region, “the risks to our baseline stem from both global developments, particularly in the US, and domestic politics and policies,” Kishore said.
“Recent months have witnessed rising political concerns in South Korea and the Philippines. Policy tensions have mounted in India and China. Upcoming national elections in Korea, Malaysia and Thailand and state elections in India are likely to be closely monitored by investors … Uncertainty is set to be the buzzword for 2017,” Kishore noted.
In an e-mail, Bea Tanjangco, Oxford Economics’ country economist for the Philippines, said that “while the Philippines is expected to grow robustly above 6 percent, we do not expect growth levels to match 2016.”
“We expect a moderation given the uncertainty clouding 2017 and the absence of external stimuli like the election,” Tanjangco said.
Still “excluding China, Japan and India, the Philippines will continue to be the fastest growing economy in the region.”
Oxford Economics expects the gross domestic product (GDP) to have grown by 6.9 percent last year. The government targets 6-7 percent growth for 2016, with the actual figure to be announced on Jan. 26.
This year, the government projected a GDP growth of 6.5-7.5 percent, before further rising to a range of 7-8 percent from 2018 onward.
However, Oxford Economics sees the Philippine economy growing at a slower pace of 6 percent in 2018 and 5.7 percent in 2019.