Standard and Poor’s (S&P) said in its latest report that the Philippines may grow over 6 percent for the next two years.
Citing the ongoing strength of the country’s economy, S&P said that under the base case, the Philippines may grow 6.5 percent this year, which is within the 6-percent to 7-percent
growth target of the government but lower than the recorded 6.6-percent growth in 2012.
It also projected a 6.3-percent gross domestic product (GDP) growth for the country in 2014, before slowing down to 6 percent in 2015.
On the downside case, S&P said that the country could grow 5.5 percent, 5.2 percent and 5 percent in the next three years, while on the upside case, the country may grow 6.8 percent, 6.6 percent and 6.3 percent in 2013 to 2015.
On the other hand, S&P also reported that although Asia-Pacific continues to record strong real GDP growth relative to other regions, activity indicators in early 2013 suggest that the rebound that began in the second half of 2012 has lost some traction.
“As a result of this softer-than-anticipated traction, we have lowered slightly our base case forecasts of 2013 real GDP growth for some countries,” it stated.
S&P sees China revised to 7.9 percent, Hong Kong to 3 percent, India to 6 percent, Japan to 0.6 percent, South Korea to 2.8 percent, Singapore to 1.9 percent, Thailand to 4.2 percent and Vietnam to 5.3 percent.
However, it noted that upward revision has been made to Malaysia, which is now 5.5 percent; Philippines, 6.5 percent; and Taiwan, 3.8 percent.
“Export growth, which began to rebound late last year, has started to soften again. Many economies in the region continue to face single-digit or even negative export growth on a year-on-year basis,” it further said.
S&P continued that its base case outlook for Asia-Pacific is that growth in most of the region will hold steady or pick up slightly in 2013 and 2014, after having slowed sharply in 2012. It added that the upside potential for the region is characterized by a stronger-than-expected global recovery, boosting trade and growth in Asia.
“In this scenario the ‘high beta’ Tiger economies would outperform the ‘low beta’ economies,” S&P noted.
Furthermore, S&P also expected that the fortunes of Asia-Pacific’s economies are still vulnerable to any deepening of the economic, or political crisis in the eurozone; a slowdown in United States growth and ongoing fiscal management, and any slowdown in China’s economy.
Mayvelin U. Caraballo