The International Monetary Fund said it expects the Philippines to grow 6.7 percent in 2018, faster than most Asian countries including China and Vietnam.
It said the annual expansion of the gross domestic product would likely pick up to 6.8 percent in 2019, with the Philippine economy on track to sustain its momentum on solid domestic demand and robust investments.
The IMF’s latest World Economic Outlook released Tuesday showed the Philippines would outperform most of its peers in the region including economic powerhouse China, which was projected to grow 6.6 percent this year. Only India was predicted to expand faster at 7.4 percent.
The growth outlook for the Philippines this year is higher than 5.3 percent for Indonesia, 3.9 percent for Thailand, 5.3 percent for Malaysia, 6.6 percent for Vietnam, 1.2 percent for Japan, 3 percent for South Korea, 3 percent for Australia, 1.9 percent for Taiwan, 2.9 percent for Singapore, 3.6 percent for Hong Kong and 2.9 percent for New Zealand.
“As you may know, these growth forecasts are among the highest in the Asia-Pacific region. We believe that the Philippine economy will continue to grow strongly, driven by solid domestic demand and public investment,” IMF resident representative to the Philippines Yongzheng Yang said in a statement after the WEO was released.
“The strong global growth will also provide a favorable external environment for the Philippines’s export growth, OFW remittances and BPOs [business process outsourcing companies]. Strong domestic reform momentum, including in the area of taxation and capital market development, bodes well for private sector investment, including FDI [foreign direct investments],” Yang said.
Yang said main risks to this growth outlook could emanate from tighter global financial conditions, trade tensions among major economies and geopolitical events.
“However, the Philippines is in a strong position to manage shocks to its economy as it has ample foreign reserves and a low level of public debt,” Yang said.
The World Economic Outlook also said the Asean-5 economies (Indonesia, Malaysia, Philippines, Thailand, Vietnam) were expected to grow 5.3 percent in 2018 and 5.4 percent in 2019.
The Philippine economy grew 6.7 percent in 2017, driven by the government’s fiscal spending,
robust domestic demand and investments.