ADB revises Philippine growth forecast lower for 2019, 2020

September 25, 2019

The Asian Development Bank ( ADB) revised its growth forecast lower for the Philippines to six percent in 2019 and 6.2 percent for 2020.

In its latest report issued Wednesday, the ADB said ''the downward revision on growth comes from the slowdown in domestic investment in the first half of 2019 mainly caused by the delayed passage of the 2019 national budget, which held back public expenditure, particularly on infrastructure.''

The ADB earlier forecast 2019 growth at 6.4 percent and 2020 goal at 6.4 percent.

''Public spending should regain traction for the rest of 2019 with the government committed to catching up with its spending plans, especially as new and larger infrastructure projects get underway,'' said ADB Country Director  Kelly Bird.

'' The recovery in public spending should also boost private consumption, which is currently well supported by steady overseas workers remittances, moderate inflation and low unemployment,'' said Bird.

Outlook for exports is expected to remain weak due to slower-than-expected economic growth in many industrialized economies, which are among the Philippines' largest export markets, ADB said,

Investor sentiment in the country remains broadly positive, with a pickup in business confidence, as seen from the Bangko Sentral ng Pilipinas survey, added the ADB. 

Public expenditure next year is expected to provide a greater boost to the economy, with the proposed 12 percent increase in the 2020 national budget, the ADB said. DMS