MANILA, Philippines – The government expects the country's economic expansion to slow down after President Benigno Aquino III's term, data from the Department of Budget and Management showed.
According to the Development Budget Coordination Committee's macroeconomic assumptions for 2014 to 2017, the Philippine economy is projected to grow by 6.5% to 7.5% this year, and 7% to 8% in 2015.
By the end of the Aquino administration's term in 2016, the economy is seen to expand at a faster pace of 7.5% to 8.5%.
However, by 2017, growth will slow down to 7% to 8%.
In 2013, the economy registered a stellar growth of 7.2%, surpassing the government's target of 6% to 7%.
In the first quarter of 2014 however, growth slowed down to 5.7% due to the lingering effects of Super Typhoon Yolanda, particularly on the agriculture and industry sectors.
The Philippine Statistics Authority and the National Economic and Development Authority are scheduled to announce the country's second-quarter economic performance on Thursday, August 28.
The country's chief economist said that the Philippines' economic growth rate in the second quarter could have bounced back to 7%, fueled by the manufacturing sector.
Finance undersecretary and chief economist Gil Beltran said on August 18 that the rise in factory output from 4.3% in the first quarter to 13% in the second quarter likely pulled growth back to 7% in the second quarter.
“Compared to the first quarter, production output in the second quarter grew almost thrice the first quarter level while sales increased 1.5 times the first quarter growth,” Beltran said.
“The slowdown of growth to 5.7% in the first quarter of 2014 is just a short-term phenomenon and should not be seen as a trend," Beltran said.
In April, Manila-based lender Asian Development Bank (ADB) said the country's economy would likely grow below government targets this year and the next, tempered by higher inflation and interest rates.
In August, the United Nations Economic and Social Commission for Asia and the Pacific (UN ESCAP) said the Philippine economy is projected to expand by 6.7% this year, with growth to be driven by private consumption and investment. The UN ESCAP forecast is at the lower end of the government's 2014 target of 6.5% to 7.5%.
The World Bank however downgraded its growth forecasts for the Philippines for 2014 and 2015, given the slow start of the economy in the first quarter and weak government spending.
In the Philippine Economic Update August 7, the Washington-based lender said that it revised its growth outlook for the Philippines to 6.4% from 6.6% for 2014, and to 6.7% from 6.9% next year.
The World Bank’s forecasts are below the government's growth targets for 2014 and 2015 (7% to 8%). – Rappler.com