The Asean+3 Macroeconomic Research Office said Tuesday the Philippine economy likely grew 7.3 percent in 2022, faster than its earlier forecast of 6.9 percent.
It noted that the gross domestic product expanded by 7.7 percent in the first three quarters last year, above the government’s target range of 6.5 percent to 7.5 percent.
“[The] Philippine economy was very strong last year…The third-quarter [GDP] was strong, that is why we revised [up],” AMRO chief economist Hoe Ee Khor said in an online briefing on the Asean+3 Regional Economic Outlook.
The economy grew 7.6 percent in the third quarter, faster than 7 percent a year ago, bucking the domestic and external headwinds such as the rising interest rates, elevated inflation and geopolitical tensions in Ukraine.
It gained strength from the agriculture, industry and services sectors in the third quarter. Agriculture and forestry grew by 2.2 percent, industry by 5.8 percent and services by 9.1 percent.
The third-quarter growth was faster than 7.5 percent in the second quarter. This resulted in an average GDP expansion of 7.7 percent in the first three quarters. The last time the economy grew at such pace was in the first three quarters was in 2010.
AMRO’s estimates showed that the Philippines was the third fastest growing economy in the region, behind Malaysia’s 8.4-percent growth and Vietnam’s 8 percent.
AMRO, however, reduced the 2023 GDP forecast for the Philippines to 6.2 percent from 6.3 percent, taking into account the impact of the global economic slowdown.
Khor said the 6.2-percent growth projection for the Philippines this year is “still a very strong growth.” This could be the second fastest in the region, next to Vietnam’s 6.8 percent.
AMRO also revised downwards its short-term growth forecast for the ASEAN+3 region for 2022 to 3.3 percent from the 3.7 percent growth forecast in October on continuing weakness in Plus-3 economies, especially China where growth turned out to be much weaker.
Growth in the ASEAN+3 region is projected to strengthen to 4.3 percent in 2023, as China’s economy is expected to rebound strongly, reflecting the removal of containment measures and reopening of its economy.
Inflation is anticipated to come down to 4.5 percent in 2023 from the projected 6.3 percent last year.
“The weakening global environment has taken the wind out of the sails of the region’s external trade momentum. The drag on economic activity from aggressive monetary policy tightening in the United States and euro area will be felt more fully this year, translating to softer export orders for the ASEAN+3,” AMRO said.
The ASEAN+3 Macroeconomic Research Office is an international organization established to contribute towards securing macroeconomic and financial stability of the ASEAN+3 region, comprising 10 members of the Association of Southeast Asian Nations and China, Hong Kong, Japan and Korea.
AMRO’s mandate is to conduct macroeconomic surveillance, support the implementation of the regional financial arrangement, the Chiang Mai Initiative Multilateralization and provide technical assistance to the members.