|
By Darwin G. Amojelar Reporter
THE World Bank on Wednesday forecast
weaker Philippine economic growth this year and next due to higher
oil prices and the expected slowdown in its biggest export market,
the US.
In a new report, the
Washington-based lender said the Philippine economy, as measured by
its gross domestic product (GDP), is likely to grow 6.2 percent this
year and 6.5 percent next year.
The estimates are lower than the
6.3 to 7 percent and 6.4 to 7.1 percent targets set by the
Development and Budget Coordinating Committee for 2008 and 2009.
For last year, the World Bank
forecast Philippine GDP to have grown by 6.7 percent, lower than the
government’s target of 6.9 to 7.3 percent.
The country’s GDP growth ramped
up to 7.1 percent in the first three quarters of 2007, based on
strong investment outlays and a pickup in services.
“The country is beginning to
enjoy the benefits stemming from the substantial fiscal adjustment,
public debt reductions, and balance-of-payments surpluses of recent
years. The current account surplus rose sharply as a result of large
remittance inflows and a diminishing trade deficit,” the World
Bank said.
“The Philippines has been
working to make its growth work for the poor, and we hope to help
much more to make that happen,” Bert Hofman, the lender’s new
country director for the Philippines said.
Foreign direct investment inflows
increased 70 percent from 2006 to $1.6 billion in the first half of
2007, while international reserves reached a record $33.7 billion
for the whole year.
“The year 2008 will likely be
challenging for policy makers, with a large number of interrelated
downside risks. These include the possibility of a full-fledged
recession in the United States, higher oil prices, and further
escalation of turbulence in financial markets linked to the US sub
prime debacle,” the World Bank said.
The multilateral lender also
expects economic growth for the East Asia Pacific region to ease to
9.7 percent this year and to 9.6 percent in 2009.
“Overall, we expect
developing-country growth to moderate only somewhat over the next
two years. However, a much sharper United States slowdown is a real
risk that could weaken medium-term prospects in developing
countries,” Uri Dadush, director of the World Bank’s Development
Prospects Group and International Trade Department said.
For 2007, the World Bank saw a 10
percent growth for the region, with China expected to expand by more
than 11 percent.
|
