by: Sarah Joson
Monday, June 20, 2016 |
HSBC (Hong Kong and Shanghai Banking Corp.) sees slower growth for the Philippines in the following quarters.
According to HSBC Economist Joseph Incalcaterra, growth is likely to decelerate in the Philippines once local market activities go back to normal after the recent elections. Despite that, the Philippines is still seen to remain a regional outperformer due to the country’s robust domestic demand.
HSBC anticipates that the Philippines will grow 5.9 percent this year, and will marginally slow down to 5.8 next year.
For the first quarter of this year, the country’s GDP growth rose to 6.9 percent in the first quarter, from the revised 6.5 percent posted during the fourth quarter of last year due to election-related spending.
The economist also said the growth was primarily propelled by investments and private consumption on top of sustained government infrastructure spending, election-related activities, and cash flows from remittances.
Moreover, economists pegged a GDP growth of 6.8 and 7.8 percent this year.
Compared to its neighboring counterparts, the Philippines’ GDP growth this year would be higher than Indonesia’s 4.9 percent, Malaysia’s four percent, Thailand’s three percent, Singapore’s 1.6 percent, and Taiwan’s 1.4 percent.
HSBC also cited the proposal of the incoming Duterte administration to increase the budget deficit target to three percent of GDP from the two percent under the outgoing Aquino administration.
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