The Asian Development Bank on Thursday upgraded its growth forecasts for the Philippines, amid the improving economic prospects in Asia and on the government’s plan to ramp up infrastructure spending.
ADB said in a supplement to its Asian Development Outlook 2017 report that it raised its 2017 and 2018 growth outlook for the Philippines, after gross domestic product grew 6.4 percent in the first quarter.
“Growth forecasts are upgraded from 6.4 percent to 6.5 percent for 2017 and from 6.6 percent to 6.7 percent for 2018,” it said.
ADB said the Philippine government was making progress in ramping up infrastructure investment.
“In addition, tax reform likely to be approved in the second half of 2017 will unleash purchasing power in 2018 through lower personal income tax,” the bank said.
The Philippine economy grew 6.4 percent in the first quarter of 2017, a moderation from 6.9 percent in the same period in 2016, partly reflecting a base effect from election spending last year.
ADB said the high first-quarter growth in Malaysia, the Philippines and Singapore kept
Southeast Asia on track to meet the 4.8-percent growth forecast this year and 5 percent in 2018.
ADB also upgraded its growth outlook in Developing Asia from 5.7 percent to 5.9 percent in 2017 and from 5.7 percent to 5.8 percent for 2018.
“Developing Asia is off to a good start this year with improved exports pushing growth prospects for the rest of 2017,” said ADB chief economist Yasuyuki Sawada.
“Despite lingering uncertainties surrounding the strength of the global recovery, we feel that the region’s economies are well-placed to face potential shocks to the outlook,” Sawada said.
Combined growth for the major industrial economies is forecast to remain at 1.9 percent in 2017 and 2018. Improved forecasts for the euro area and Japan due to robust domestic demand have offset the slight growth downturn in the US to 2.2 percent from the previously projected 2.4 percent as a result of disappointing first quarter results in 2017, it said.
ADB said by subregion, growth for East Asia was revised upward to 6 percent in 2017 and 5.7 percent in 2018 from the original projections of 5.8 percent and 5.6 percent, respectively.
After recent growth moderation, an increase in net exports and domestic consumption has improved growth prospects in the People’s Republic of China. The world’s second largest economy is now expected to expand 6.7 percent in 2017 and 6.4 percent in 2018.
South Asia will remain the fastest growing of all subregions in Asia and the Pacific, with growth on track to meet original projections of 7 percent in 2017 and 7.2 percent in 2018, according to the report. India”•the subregion’s largest economy”•is expected to achieve previous growth projections of 7.4 percent in 2017 and 7.6 percent in 2018, primarily from strong consumption.
The outlook for Central Asia this year also improved as stronger domestic demand and exports in some countries have fueled an unexpected recovery in the subregion.
Growth is expected to reach 3.2 percent in 2017 and 3.8 percent in 2018 compared to the 3.1 percent and 3.5 percent original projections, respectively.
Growth in the Pacific is expected to remain at 2.9 percent in 2017 and 3.3 percent in 2018 with Papua New Guinea”•the subregion’s largest economy”•continuing its gradual recovery due to rebounding mining and agriculture industries. Stronger tourism prospects are also expected to drive growth further in the subregion, particularly in Fiji and Palau.