Felipe Medalla, Governor of BANGKO Sentral ng Pilipinas, predicts the Philippine economy will grow by 8-9 percent in the second quarter of the year.
“Maybe it can’t be around 9-8 percent. The problem is that the second half will be slower. That’s why my personal prediction is seven for the year,” he told reporters over the weekend.
Medalla’s opinion is compared to gross domestic product (GDP) growth of 8.3 percent in the first quarter of the year.
During an online business forum hosted by The Manila Times, he said that economic growth of 6.5% or more is achievable this year given the continued strength of indicators such as foreign direct investment and consumer demand. and business sentiment.
“So, I’m actually quite optimistic about the economy under the current president… I would say that 80 percent of the economy is now well above pre-pandemic levels,” Medalla added.
He said the economy could adjust to the aggressive monetary policy adopted by the central bank to curb inflation.
The International Monetary Fund (IMF) has previously said it expects Philippine GDP to grow in line with the government’s target this year and then slow down by 2023.
“Our GDP growth forecast for 2022 is currently 6.7 percent, reflecting a strong recovery momentum in the first half of the year, with increased mobility as the impact of the Omicron wave turned out to be less severe than expected,” said Ragnar, IMF Resident Representative for the Philippines. Gudmundsson noted.
The latest IMF growth estimate for the Philippines is an upward revision from the previous forecast of 6.5 percent.
The economy, measured by GDP, grew 8.3 percent in the first quarter of the year. The government is targeting 6.5-7.5% growth by 2022, recently cut from 7% to 8% but still stronger than last year’s actual growth of 5.7%.
However, Gudmundsson said growth is expected to slow in the second half of 2022 and into 2023 due to base effects, the effects of the war in Ukraine, slower growth in major trading partners, faster U.S. monetary tightening and high inflation.
“As a result, we currently project that GDP growth will decline to around 5 percent in 2023,” he said, adding that there is “significant uncertainty about growth prospects in such a volatile global environment.”
The forecast for 2023 has been revised down from the previously expected 6.3 percent and well below the government’s target range of 6.5 to 8 percent.