The Philippines is seen to have missed its goal of boosting local output expansion averaging at least 6 percent in 2023, having grown at a slower rate of only 4.9 percent in the fourth quarter last year, analysts at Moody’s Analytics said on Monday.
At this rate of expansion, measured as the gross domestic product (GDP), the economy of 112 million is forecast to have grown by only 5.38 percent.
Data analysts at Moody’s noted stronger consumption activities across the economy in the December-quarter as the threat of punitive inflation receded.
The employment rate also proved the highest on record during the period at 96.4 percent from 95.8 percent based on data published by the Philippine Statistics Authority.
According to Moody’s, accelerated public sector spending during the period also lent support to the USD404 billion economy, further boosted by remittances last reported by the Bangko Sentral ng Pilipinas rising by 2.8 percent in November last year to USD2.6 billion. The remittances help fuel consumption that accounts for roughly 75 percent of nominal GDP based on estimates.
Nevertheless, the growth-boosting efforts of the government sector are seen tempered by a softening global economy that effectively puts a cap on private investment and trade, Moody’s analysts said.
President Ferdinand Marcos Jr. had said the economy was likely to grow close to the 6 percent to 7 percent target this year.
The International Monetary Fund, at its last assessment of the economy under the so-called Article IV consultations, projected a growth path averaging 5.3 percent for the Philippines in 2023 accelerating to 6 percent this year.
The World Bank previously released as assessment saying growth across the Philippines was likely to average 5.6 percent in 2023 and accelerate to 5.8 percent this year on the basis of greater services contribution to national output supported by the ongoing recovery of the tourism sector and the consistent performance of the information and technology space as well as by the business process outsourcing sector.
Manila-based Asian Development Bank forecast growth averaging 5.7 percent when it last published its Asian Development Outlook in December last year.
