Applicants wait for screening during a jobs fair conducted by Cebu Pacific, the country’s second-largest airline, at a hotel in Makati city on Aug. 31, 2012. Although the Philippines is likely to see a moderation in its growth in the second half of 2012 due to external factors, the Philippine]economy would still hold up, according to the HSBC. AP PHOTO/BULLIT MARQUEZ
The Philippines is likely to see a moderation in its growth in the second half after posting an above-target 6.1-percent economic expansion in the first six months due to the dampening effects of problems outside the country.
This was the view of HSBC and Barclays, which both expected growth in the country’s gross domestic product in the last two quarters of the year to be lower than the 6.3 percent registered in the first three months and the 5.9 percent posted in the second quarter.
The eurozone, a major export market for Philippine-made goods, is in recession and has just received a warning from Moody’s Investors Services on a potential downgrade in its triple-A credit rating within the short term.
The United States, another key trading partner of the Philippines, remains confronted with high unemployment and anemic consumer spending.
HSBC said, however, that the Philippines would likely be able to partly offset the dampening effects of the economic problems of the advanced economies and that any slowdown in growth would be mild.
“A slowdown is expected in the second half, but the [Philippine] economy would still hold up well as fiscal spending is robust, remittances are resilient, PPP [public-private partnership] projects are picking up and service exports would likely offset lackluster goods exports,” HSBC said in its latest report on the Philippines authored by economist Trinh Nguyen.
Barclays said the recent floods, which caused a temporary disruption in agriculture production, would impact, but only minimally, on the expansion of the Philippine economy in the second semester.