by: Sarah Joson
Monday, April 13, 2015 |
Fitch Ratings’ report released last April 2 covered its March 17 rating and growth prediction for the gross domestic product (GDP) of the Philippines. The debt watcher anticipates that the country’s GDP will expand to 6.3% this year, from 6.1% in 2014. It is also predicted that it will reach 6.2% next year. The country currently has a “BBB-“ investment grade and a “stable” outlook from Fitch.
The latest forecasts for 2015 and 2016 are higher than the predictions released in January wherein growth was set at 6.2 percent and 6.0 percent, respectively. The report also revealed that the steady inflow of remittances from overseas Filipino workers and the bullish business process outsourcing sector will continue to propel growth.
However, Fitch’s growth predictions are lower than the 7-8% growth targets set by the government. Last year, the economy grew by 6.1% - marginally lower compared to the government’s 6.5-7.5% target. Issues that strained the growth last year include slow agricultural sector, and lower-than-expected and sometimes dwindling state spending.
Fitch said sustained and strong growth in the country will lessen the income and development differences with its ‘BBB’ range peers without causing imbalances, and it would be considered positive for ratings.
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