MANILA, Philippines – The World Bank has downgraded its growth forecast for the Philippines to 6.4 percent for 2019 as the government operated on a reenacted budget in the first quarter and amid a looming prolonged dry spell due to El Niño.
In a press conference Monday, World Bank senior economist Rong Qian said the updated 2019 forecast – lower than the projected 6.5 percent in January – was due to the impact of the delay in the approval of the P3.757-trillion 2019 national budget, limiting government spending to the reenacted budget.
Amid the deadlock on the 2019 appropriations, the Cabinet-level Development Budget Coordination Committee (DBCC), last month slashed its gross domestic product (GDP) growth target for the year to 6-7 percent from 7-8 percent.
El Niño was also expected to trigger an increase in the price of food, making the poor more vulnerable, Qian said.
But Qian said that easing headline inflation of late is expected to boost private consumption amid still “robust domestic demand.” / gsg