Pandemic recovery prospects brighter for Philippines

MANILA, Philippines — Recovery prospects for the Philippines just got better, joining some Asia Pacific peers in a “multi-speed” bounce-back from the pandemic’s economic wrath, Oxford Economics said.

In an update to its “Asia Pacific Recovery Scorecard” released Wednesday, the think tank gave the Philippines a score of -0.12, better than -0.4 rating given in June. 

Better readings translated to better placing in the region. Forecasts for the local economy now fare better than that of Hong Kong (-0.21), Indonesia (-0.26), and India (-0.67). In the previous report, only India was seen faring worse than the Philippines.

“The world is entering a more difficult stage of recovery, with the post-lockdown (gross domestic product) bounce expected to give way to slower growth in coming quarters,” Oxford Economics said in the report.

“At the same time, the COVID-19 situation has broadly deteriorated across Asia Pacific economies, following the widespread easing in social distancing measures since mid-Q2 (second quarter),” it added.

The overall score is based from four metrics of health and economic vulnerability, the tightness of lockdowns enforced, virus containment, and policy support for recovery. The Philippines performed better in three out of four indicators since June.

The only gauge where there was some weakening was on economic vulnerability to the pandemic. The country’s score inched down to -0.3 from -0.2 previously due to weak healthcare capacity.

On the flip side, gradual easing of movement restrictions since June improved the country’s standing in a gauge measuring lockdowns. From -0.3 last June, the score went up to 0.1, signaling more economic reopening. Ramped-up testing, meanwhile, improved perception of virus containment to -0.5 from -1.2.

The last metric, measuring macro policy support, also got better to 0.2 from 0. 

Across the region, New Zealand, which was applauded for quickly containing the coronavirus, is now see leading Asia Pacific in terms of recovery, dislodging Vietnam, where a second wave of outbreaks have threatened early success against the deadly virus. Hanoi now ranked fifth in the region.

Also ahead of the Philippines were Taiwan (0.32), Singapore (0.19), South Korea (0.18), Japan (0.07), Malaysia (0.05), Australia (0.05) and China (0.02) and Thailand (-0.02).

“We remain cognizant of the risks to our forecasts that our recovery framework doesn’t completely capture. Recurring waves of the pandemic would lead to uneven resumption of activity and slower recovery,” Oxford Economics said.

“On the upside, a faster-than-expected approval and distribution of a vaccine could boost consumer and business confidence, accelerating the recovery,” it added.