The Asian Development Bank (ADB) maintained its growth forecast for the Philippine economy at 6% for this year and 6.2% for next year. This positive outlook is driven by the steady recovery the region is experiencing from the pandemic, with domestic demand and services activity playing a major role. The Philippines, in particular, is benefiting from a strong recovery in tourism.
In the first quarter of 2023, the Philippine economy grew by 6.4% due to robust investment and private consumption. Rising employment, expanding production and retail sales, and brisk private and public construction further supported this growth. However, merchandise exports declined, but this was partly offset by an expansion in service exports. The ADB also highlighted the bounce back in tourism and the strength of the business process outsourcing and information services sectors.
Victor Abola, an economist at the University of Asia and the Pacific, expects a 5.6% growth in the second quarter of the year, followed by a more robust recovery in the third and fourth quarters. Looking ahead to 2024, Abola predicts an acceleration to 6.5% growth due to infrastructure projects gaining momentum and the government’s housing program addressing the backlog of 6 million housing units.
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