MANILA, Philippines – Economic managers are confident the Philippines would continue to enjoy a robust economic growth next year as more opportunities open up and outweigh the impact of external headwinds.
Officials told local and foreign fund managers and analysts, as well as other international stakeholders in an Investor Conference Call organized by the Investor Relations Office (IRO) that next year’s targets of robust growth and modest inflation are achievable.
“Bottom line is that the Philippines is on a solid footing despite fragility of the global operating environment,” Bangko Sentral ng Pilipinas (BSP) managing director for monetary policy Francisco Dakila Jr. said.
Economic managers penned a gross domestic product (GDP) growth target of 6.5 to 7.5 percent for 2017 from a range of six to seven percent this year. The BSP has set an inflation target of two to four percent between 2016 and 2018.
Should the targets be realized as projected by officials, the Philippines would continue to be in an enviable “sweet spot,” being able to post strong economic growth without suffering from runaway inflation.
Attainment of the growth target for next year would continue to make the Philippines one of the best performing countries in the region, said IRO executive director Editha Martin.
Among the major Asian countries, the Philippines was one of the fastest growing economies with an average GDP growth of seven percent in the first nine months, surpassing China’s 6.7 percent, but behind India’s 7.4 percent.
The strong economic growth of the Philippines is seen to continue even as the global economy enters 2017 with uncertainties arising from key challenges, including change in political leadership and the anticipated rise of interest rates in the US, the continuing process of “Brexit,” and slowdown in China and other major economies.
The country’s buffers, particularly fiscal and monetary space, would help provide resilience to the domestic economy, officials said.
Dakila said inflation is seen to slightly inch up from the estimate of below two percent this year to around the midpoint of the official target band by next year.
“Price stability would be supported by rising investments, which boost the economy’s productive capacity and, therefore, the supply of goods and services. Rising investments are evidenced partly by increasing imports of capital goods, intermediate goods, and raw materials,” Dakila said.
National Economic and Development Authority Undersecretary Rosemarie Edillon said there are additional growth drivers next year.
“We see certain growth opportunities beginning next year,” Edillon said.
She pointed out the progress of economic integration of the Asean region, a market of about 600 million people, which could spur Philippine exports.
Edillon likewise cited the administration’s infrastructure agenda, which is expected to go full swing in 2017, the first year that the government will operate under a Duterte-administration budget.
12 December 2016
By Lawrence Agcaoili
