Illustrative image (Source: cnnphilippines.com)
The Asian Development Bank (ADB) has recently reduced its economic forecast for the Philippines to 6.2 percent this year from the previous 6.4 percent.
However, ADB maintains its estimate of 6.4 percent for 2020 in its Asian Development Outlook Supplement report released on July 18.
The report cited the government under-spending resulting from delayed passage of the national budget that moderated economic growth to 5.6 percent in the first quarter.
In the period, public construction contracted while growth in government consumption eased. Growth in exports of goods and services also slowed as a result of lackluster global trade and economic activity and the downturn in the electronics cycle. These effects were partly offset by higher household consumption and private investment, it said.
The bank predicted public investment to rebound in the second half of 2019 following budget approval in April and to pick up next year as more infrastructure projects come on stream.
Meanwhile, slowing inflation, low unemployment, and steady remittances will continue to support household consumption, it added.
It also revised its inflation forecast for the Philippines from 3.8 percent to 3 percent this year, considering lower food prices.
Inflation in the country slowed down to 2.7 percent in June 2019, averaging 3.4 percent in the first half./.