ADB hikes growth forecasts for Philippines

MANILA, Philippines — The Asian Development Bank has upgraded its 2017 and 2018 economic growth forecasts for the Philippines, with infrastructure investments seen to continue playing an important role in the country’s development.

In a supplement to its Asian Development Outlook published on Wednesday, the Manila-based multilateral lending institution said it expects the Philippines to clock a 6.7 percent gross domestic product growth this year from the previous estimate of 6.5 percent.

ADB also raised its 2018 GDP forecast for the country to 6.8 percent from 6.7 percent.

READ: ADB retains Philippine growth forecasts

“This outlook assumes that growth in the government’s infrastructure program will accelerate, supported by improvements in budget execution, with more large investment projects under way,” the ADB said.

The country’s GDP — or the value of all finished goods and services produced in the country — registered a solid 6.9 percent growth rate in the third quarter of 2017.

READ: Philippine economy expands by 6.9% in Q3, beating forecasts

The figure puts the economy on track to meet the government's 6.5-7.5 percent full-year target.

The Philippines’ third quarter GDP was higher than the upwardly revised 6.7 percent logged in the second quarter and above the 6.5-6.7 percent estimate by market analysts, although slower than the 7.1 percent recorded in the same period last year.

According to Socioeconomic Planning Secretary Ernesto Pernia, both public and private spending are expected to propel the economy in the coming months.

The government plans to spend about P847.22 billion this year on infrastructure alone, equivalent to 5.32 percent of GDP as part of its “Build, Build, Build” program.

“The Philippines remains one of the best performing economies in Asia,” Pernia said.

Meanwhile, economic growth in Southeast Asia is picking up faster, ADB said, adding that the region’s GDP is now seen to expand by 5.2 percent in 2017 and 2018.

“Developing Asia’s growth momentum, supported by recovering exports, demonstrates that openness to trade remains an essential component of inclusive economic development,” said Yasuyuki Sawada, ADB’s chief economist.

“Countries can further take advantage of the global recovery by investing in human capital and physical infrastructure that will help sustain growth over the long-term.”