MANILA, Philippines - The International Monetary Fund has cut its 2015 growth forecast for the Philippines as merchandise exports are expected to post a slower growth.
In the latest World Economic Outlook, IMF said it now expects the Philippine economy to grow by 6.3 percent next year, down from a 6.5 percent projection earlier.
The Fund, however, kept its 2014 growth forecast at 6.2 percent.
“For the Philippines, the growth outlook remains favorable, with GDP (gross domestic product) growth expected to pick up slightly from 6.2 percent in 2014 to 6.3 percent in 2015,” IMF Resident Representative Shanaka Jayanath Peiris said in an e-mail.
“The rise in Philippine trading partner growth from 2014 to 2015 is lower than the previous WEO, on average, so Philippines growth (and exports) is expected to accelerate more modestly in 2015,” he added.
Both projections are below the government’s 6.5- to 7.5-percent target this year and the seven- to eight- percent goal for 2015.
The World Bank on Monday also revised its growth projections for the country to 6.4 percent from 6.6 percent for 2014, and to 6.7 percent from 6.9 percent for 2015.
The Asian Development Bank, meanwhile, also downgraded its forecasts for Philippine economic growth to 6.2 percent from 6.4 percent for 2014 and to 6.4 percent from 6.7 percent for 2015.
Philippine economic growth accelerated to 6.4 percent in the second quarter from a disappointing 5.6 percent in the first quarter. This brought the first half growth to six percent, still below the government’s full-year assumption.
IMF said that while the growth trajectory in Asia and the Pacific remains steady, it will be dependent on the global economic recovery.
“The region’s near-term outlook remains strong, predicated on a continuing global recovery,” IMF said, noting regional growth is seen hitting 5.5 percent this year and accelerating to 5.6 percent in 2015.
Both projections, however, are weaker than earlier forecasts published in the April WEO reflecting a slower-than-expected first quarter prints for the economies in the region.
“Growth is expected to be driven by domestic demand, given still-favorable financial conditions and healthy labor markets, but export growth is also expected to remain strong given the projected rebound in advanced economies and China,” the IMF said.
“The macroeconomic policy stance across most economies is also expected to remain broadly supportive. Inflation is forecast to remain generally low and stable,” the Fund added.