Growth forecasts for the Philippines collected by Barcelona-based FocusEconomics showed below-target consensus expectations averaging 5.6 percent for 2021, mainly due to sluggish mass vaccination against COVID-19.
In its latest emerging markets outlook 2021-2022 report, FocusEconomics noted that only Allianz and Capital Economics projected the Philippines’ gross domestic product (GDP) this year growing in line with the government’s downscaled 6-7 percent target range.
Allianz was the most bullish with its forecast of 7.8-percent growth in 2021, while Capital Economics projected 6 percent, or the lower end of the target band.
On the other hand, ANZ’s forecast was 4.8-percent GDP growth this year; BDO Unibank, 5.5 percent; and Citigroup Global Markets, 4.9 percent. Twenty-five other forecasters had an average of 5.5-percent 2021 growth projection for the Philippines, FocusEconomics said.
“Activity appeared to be largely export-driven in the second quarter, as the domestic economy struggled to gain steam. On one hand, merchandise exports surged in April, largely on skyrocketing shipments for electronic products. On the other hand, the manufacturing PMI [purchasing managers’ index] contracted on average in April to May,” FocusEconomics noted.
It also noted that about one-fourth of the labor force in the Philippines remained either jobless or underemployed.
As for the gradual reopening of the Philippine economy, FocusEconomics said “momentum should build going forward, although the low vaccination rate could lead to further stop-start restrictions.”
As of Tuesday, over 12 million COVID-19 vaccine doses had been administered nationwide, but this was still far from the goal to vaccinate all adults or 70 million Filipinos by yearend to reach herd immunity. INQ