Philippine growth at 7.6% in Q1 – ANZ Bank

MANILA, Philippines – The Australia and New Zealand (ANZ) Banking Group Ltd. sees the country’s economic growth exceeding seven percent in the first quarter due to election-related spending and a surge in industrial production growth.

In its latest Macro Strategy Weekly, ANZ said the Philippine economy likely grew 7.6 percent in the first quarter from 6.3 percent in the fourth quarter of last year.

It pointed out the country’s first quarter GDP is expected to get a boost from election-related spending and top growth in the region.

“We see growth being boosted by election-related spending during the quarter. Import growth remained robust, indicating the persistence of above trend rise in household consumption. This is also complemented by a surge in industrial production growth,” ANZ said.

The investment bank sees the country’s GDP expanding 6.1 percent this year before slowing down to 5.8 percent next year.

The country’s GDP growth slowed down to 5.8 percent last year from 6.1 percent in 2014 due to weak global demand and lack of government spending.

ANZ said the Philippines has been a focus for markets of late due to the May 9 presidential and national elections topped by front runner Davao City Mayor Rodrigo Duterte.

Incoming President Duterte, a 71- year-old political veteran who has been undefeated in all of the 11 elections he has participated in since 1986, allowing him to serve in various capacities in the executive and legislative branches of the government, will be inaugurated as the country’s 16th president on June 30.

“Philippine asset prices had been underperforming in the lead-up to the election, as Duterte’s tough talking personality provided for a sensational campaign and investors were unsure of his economic policies,” ANZ said.

It added the focus now is on Duterte’s proposed line-up for his Cabinet.

“His most recent statements on raising the limits on foreign ownership should increase the country’s potential growth. The devolution of development beyond the National Capital Region will also likely be a focus over the next six years for Duterte,” ANZ added.