2022 GDP GROWTH SEEN TO MISS GOV’T TARGET

Economic think tanks expect the Philippines’ growth this year to fall short of the government’s ambitious 7 to 9 percent goal amid lingering COVID-19 risks, especially new strains that may spread faster in contact-intensive domestic sectors.

In an email on Tuesday, Institute of International Finance (IIF) deputy chief economist Elina Ribakova said the country’s gross domestic product (GDP) likely grew 6 percent year-onyear in the fourth quarter of last year, to bring full-year 2021 expansion to 5.2 percent, within the government’s 5 to 5.5 percent target. The latest GDP report will be out on Jan. 27.

Ribakova said the Philippine economy “continued to improve” in the last three months of 2021 mainly on the back of manufacturing sector recovery. She said fourth-quarter GDP likely rose 15.4 percent compared to third-quarter output on a non-seasonally adjusted basis.

But Ribakova said “the surge of new cases since January posed new challenges for private sector recovery” in the current first quarter of 2022. The stricter alert level 3 restrictions until end-January in Metro Manila, its surrounding provinces, and other areas with Omicron outbreaks, which accounted for over half of the economy, would cost P3 billion in output losses per week, government estimates had shown.

The regional surveillance organization Asean+3 Macroeconomic Research Office (Amro) also slashed its 2022 GDP growth forecast for the Philippines to 6.2 percent from 6.7 percent previously, although the projection for 2021 was hiked to 4.9 percent from 4.3 percent.

In its Asean+3 regional economic outlook update report released on Tuesday, Amro attributed its higher 2021 forecasts for the Philippines, Cambodia, Singapore and Thailand to “stronger pickups in economic activity, which were helped by rapid vaccination progress and robust exports in the last quarter of the year.”

On the other hand, downgraded 2022 projections for the Philippines, Cambodia, Indonesia, Laos, Malaysia and Thailand were blamed by Amro on “the spread of the highly transmissible Omicron variant at the beginning of the year [which] necessitated the reimposition of containment measures.”