World Bank hails steady Philippine growth

MANILA, Philippines—The World Bank on Wednesday praised the Philippines for its steady economic growth despite the global economic shocks and hailed reforms made by the government of President Benigno Aquino III.

In its quarterly update, the bank said it expects Philippine economic growth to stabilize at 5 percent this year and rise to 5.4 percent in 2012. The economy grew 7.6 percent last year.

Manufacturing, construction, buoyant metals prices as well as a booming business process outsourcing industry are expected to be the main growth drivers, said World Bank senior economist Eric Le Borgne.

The body also cited potential gains from reforms put in place by Aquino who was elected in May 2010.

“Prospects on the supply side remain favorable with manufacturing and construction projected to benefit from the end of the trade disruption linked to Japan’s post-disaster reconstruction,” Le Borgne said in a statement.

The update also praised Aquino for his efforts to fight corruption, upgrade the country’s infrastructure, and open up aviation to foreign competition to boost tourism.

World Bank country director Bert Hofman said the Philippines’ recent performance, which saw 4.9 percent growth in the three months to March, suggests growth had become more robust and steady since the global crisis.

He cited a series of credit rating upgrades that put the Philippines’ sovereign debt to within two rungs of investment grade last month.

Aquino’s office said in a statement that the World Bank report showed that the Philippines’ economic fundamentals had “significantly improved” and that the government’s programs were sound.

Manila has an “aspirational target” of 7-8 percent GDP growth for 2011 but projects more modest growth of 5-6 percent.