Robust gross domestic product growth of 6.2% in Q3 has led the International Monetary Fund (IMF) to raise its overall 2020 economic growth forecast for the Philippines to 6.3%. Despite this vote of confidence, the international financial institution’s improved estimate is still below the 6.5-7.5% target previously announced by the country’s government. Taking a broadly positive view, though, Tomas Helbling, the IMF’s Asia and Pacific division chief, said the Philippines remains one of the region’s best-performing economies, with next year’s predicted accelerated growth likely to be driven by increased government spending and recent moves to ease its monetary policy.
Similarly, upbeat, Yongzheng Yang, the IMF’s resident representative in the Philippines, said the high probability that the county’s 2020 PHP4.1tn (US$80bn) national budget would be approved in a timely fashion would only increase the growth momentum. Earlier this year, the IMF lowered the country’s 2019 economic growth forecast to 5.7% – below the 6-7% government target – largely on account of the lower than anticipated 5.5% economic growth recorded for the first half of 2019, a consequence of delays in the approval of the PHP3.7tn national budget. This failure to get the budget approved on schedule obliged the government to underspend in accordance with the readopted 2018 budget.