by: Karen Cayamanda
Friday, May 15, 2015 |
With the country’s slow inflation rate, higher government spending, and robust services sector, the Philippines’ gross domestic product (GDP) could grow by 6.5% this year. This is according to the Economic and Social Survey of Asia and the Pacific 2015 report by the United Nations Economic and Social Commission for Asia and the Pacific (UN ESCAP). This new growth prediction is a bit higher than the UN agency’s estimate last January (6.4%).
If the country reaches this forecast, it will be higher than the 6.1% growth rate last year. Also, ESCAP predicts a 6.4% growth rate in 2016.
Though this latest growth forecast is still below the target of the government for 2015-16 which is 7-8%, the regional development arm of the UN said the 2015-16 forecasts are still better than the average estimates predicted for Southeast Asia - 4.9% this year and 5.1% next year.
The Philippine economy continues to post better growth rates than its neighboring countries among the five other older members of the Association of Southeast Asian Nations. The region is likewise expected to post improved near-term outlook, thanks to the economic recovery of Thailand as well as the economic growth of Indonesia and the Philippines.
Moreover, ESCAP expects the services sector of the Philippines to continue to drive growth, particularly the business process outsourcing sector which is predicted to post $25 billion in revenues next year, or 10% of the economy. Remittances from about 11 million OFWs are also expected to contribute to this growth.
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