PH seen missing GDP growth target for 2021

Growth forecasts for the Philippines collected by Barcelona-based FocusEconomics showed consensus expectations below the target averaged 5.6 percent in 2021, mainly due to sluggish mass vaccination against COVID-19.

In its latest Emerging Markets 2021-2022 report, FocusEconomics noted that only Allianz and Capital Economics presented the Philippines’ gross domestic product (GDP) this year, which grew in line with the government’s scaled-down target range of 6-7 percent.

Allianz was the most bullish with its forecast of growth of 7.8 percent in 2021, while Capital Economics expected 6 percent or the lower end of the target band.

On the other hand, ANZ’s expected GDP growth was 4.8 percent this year; BDO Unibank, 5.5 percent; and Citigroup Global Markets, 4.9 percent. Twenty-five other forecasters had an average of 5.5 percent 2021 growth projection for the Philippines, FocusEconomics said.

“The activity seemed to be largely export-driven in the second quarter, as the domestic economy struggled to get steam. On the one hand, merchandise exports rose in April, mainly on skyrocket shipments of electronic products. On the other hand, the manufacturing industry PMI [purchasing managers’ index] contract on average in April to May, ”noted FocusEconomics.

It also noted that about a quarter of the workforce in the Philippines remained either unemployed or underemployed.

Regarding the gradual reopening of the Philippine economy, FocusEconomics said that “the momentum should grow forward, although the low vaccination rate could lead to further stop-start restrictions.”

As of Tuesday, more than 12 million doses of COVID-19 vaccine had been administered nationwide, but this was still far from the goal of vaccinating all adults or 70 million Filipinos by the end of the year to achieve herd immunity. INQ

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