For this year, the economic managers of the Philippine government set a gross domestic product or GDP growth goal of 6.5 to 7.5 percent.
Nicholas Mapa is an economist at ING Bank Manila. He referenced this target when he relayed that the government would experience challenges.
Mapa mentioned the coronavirus (COVID-19) outbreak as among the reasons.
He cited that this event is why the administration would find it challenging to meet its 6.5 to 7.5-percent GDP growth target.
Hence, Mapa said that the Philippines might have to be satisfied with the progress that is more rapid compared to the upsetting 5.9-percent growth of 2019.
The ING Bank Manila economist said that this situation is despite expectations for faster expansion.
A quick clearing of the scenario or an extra stimulus from the Philippine government may reverse this situation, Mapa remarked.
Ruben Carlo Asuncion is the chief economist at Union Bank of the Philippines. He is another observer who has decreased his GDP expansion forecast for the country.
He remarked that they are slashing their projection to 6.3 percent. Asuncion said that this figure is lower than their 6.6-percent initial full-year GDP growth projection.
The COVID-19 infections are spreading outside China. Asuncion affirmed that the epidemic had entered a new stage.
This event impacts the 2020 GDP expansion of the Philippines, he added.
The Union Bank chief economist affirmed that, in the first quarter, GDP growth possibly plummeted below six percent.
This range is from 5.4 to 5.9 percent, he explained. Asuncion cited that the GDP growth prediction would most possibly get modified.
This scenario would happen as soon as the government includes new economic information, including COVID-19’s effects in China, he added.
The Philippines registered 84 uninterrupted quarters in 2019 that demonstrated progressive GDP growth.
This number is a 6.4-percent figure recorded in last year’s fourth quarter. It is higher than the third quarter’s six-percent surge.
Nevertheless, this growth in the Philippines’ GDP marked a slowdown, as per the Philippine daily newspaper Philippine Star’s report.
From 6.2 percent in 2018, it became sluggish, posting an eight-year low in 2019 of 5.9 percent.
This number indicates a much slower trend, compared to the 6 to 6.5 percent growth target the inter-agency Development Budget Coordination Committee had set.
The deferred implementation of the Philippine national budget is among the factors for this incidence.
Furthermore, the trade battle between China and the United States is another reason. Finally, the Bangko Sentral ng Pilipinas has tightened a cycle.
This development witnessed interest rates to skyrocket by 175 basis points. All of these recent trends resulted in soft international markets.
They have affected the expansion of the Philippines’ GDP.
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