The Philippines and Indonesia will continue to sustain their economic growth for the next five years, according to the Organization for Economic Cooperation and Development (OECD).
The OECD’s Economic Outlook for Southeast Asia said the Philippines has the best growth perspective among the Asean-5 with an average growth forecast of 6.2 percent for 2015 to 2019.
This is the first time since the Outlook was first published in 2010 that the Philippines snagged the best growth forecast among the Asean-5 countries.
Growth forecasts for the other Asean-5 countries are 6.0 percent for Indonesia; 5.7 percent, Vietnam; 5.6 percent, Malaysia; and 4.1 percent, Thailand.
“The Outlook sees the large Asean-5 economies—Indonesia, Malaysia, the Philippines, Thailand and Vietnam—sustaining their growth momentum over the medium term, led by Indonesia (6.0 percent) and the Philippines (6.2 percent),” the OECD said.
It noted that Indonesia’s National Medium-Term Development Plan (2010-2014) and the Philippines’ Development Plan (2011-2016) contributed to strong economic performances in both countries, but challenges remain in reducing inequalities.
According to the report, which was shared by the Department of Foreign Affairs (DFA) on Thursday, growth momentum for the 10-strong Association of Southeast Asian Nations (Asean) remains “robust” and is expected to average 5.6 percent in the next five years.
The growth forecast for China is at 6.8 percent.
Other Asean countries are Laos, Cambodia, Myanmar, Brunei Darussalam and Singapore.
The OECD Economic Outlook “is an annual publication on Asia’s regional economic growth, development and regional integration process.”
It focuses on the economic conditions of the Asean member-countries, as well as the relevant economic issues in China and India in order to fully reflect economic developments in the region.
The 2015 edition of the Outlook was launched during the Asean Trade and Investment Summit at Nya Pyi Daw, Myanmar, from November 11 to 13.
The report said while the outlook for many OECD countries remains subdued, emerging Asia is set for healthy growth over the medium term. Annual gross domestic product growth for the Asean-10, China and India is forecast to average 6.5 percent over 2015-2019. Growth momentum remains robust in the 10 Asean countries, with economic growth averaging 5.6 percent over 2015-2019.
“The region remains exposed to domestic and external risks, however, that make continued reform, regional integration and the strengthening of institutional capacities critical,” it added.
Economic prospects for Brunei Darussalam and Singapore are stable, while Cambodia, Laos and Myanmar are set to speed ahead with average annual growth exceeding 7 percent.
Of Emerging Asia’s two largest economies, China’s growth is forecast to slow to 6.8 percent over 2015-2019 as it adjusts to changing demographics, a shift from investment- to consumption-led growth and agricultural, environmental and educational challenges, the group said. It added that India’s growth should remain stable at 6.7 percent, before any potential boost from the new government’s reform plans.
“While the Emerging Asian economies show resilience, they remain exposed to several risks, including slowing external sources of demand and regional political instability,” said OECD Deputy Secretary General Rintaro Tamaki during the launch of the report at the Asean Business and Investment Summit in Myanmar. “Further accelerating the process of regional integration to build the Asean Economic Community by 2015 is necessary, as is building the domestic capacities in the public sectors to support the implementation of policies that will foster growth and development.”
“Strengthened institutional capacities and effective governments are needed across the region to foster sustainable and inclusive growth. The Outlook highlights the importance of pursuing comprehensive, well-designed and appropriately-paced reforms, while recognizing the importance of country-specific contexts in shaping their outcomes” OECD Development Center Director Mario Pezzini said.