The Philippine economy will keep growing in the coming years, despite the outcome of the presidential race next year, Australia and New Zealand Banking Group Ltd. said Wednesday.
ANZ said in a report titled Economic Insight—the Philippines, the country was poised to sustain its growth because of the vital reforms that were put in place, even before the Aquino administration took office in 2010.
“Regardless of who wins the presidential elections in May 2016, we believe the Philippines is well-positioned to maintain its growth momentum and outperform its regional peers, even amid fears of China’s slowdown,” ANZ said.
“In sum, we believe that most of the structural changes in the Philippines needed for economic advancement were already in place before President Aquino assumed power in 2010,” it said.
The bank said the economic fundamentals, which led to the country’s increased GDP growth and relative stability, especially over the last five years, were now firmly entrenched in the country’s institutions.
“In our view, the wheels of improvement in economic fundamentals were already in motion even before the Aquino administration came into power in June 2010,” it said.
ANZ said the business process outsourcing sector, an industry which was a steady source of dollar revenues for the past years, was already flourishing even before Aquino assumed office due to incentives introduced in the early 2000s.
It said investment growth, though volatile, had been rising since 2001. Government debt has also declined since 2004, while the overall budget deficit would likely remain narrow, it said.
The report said while an improvement in local sentiment supported growth during the Aquino administration, there could be a “little risk” of a reversal in the country’s growth momentum even after President Aquino steps down in June 2016.
The succession of power in Malacañang Palace in 2016 was one of the usual topics in several fora, with analysts unsure if the country’s growth momentum would be sustained in the years ahead.
The Philippines has been outperforming its peers in the region over the past couple of years, given its sound macroeconomic fundamentals and less exposure to external trade.
The economy grew 6.1 percent in 2015, slower than the 7.2-percent expansion registered in 2013, but was still one of the strongest in the region.
