ADB maintains 6% growth forecast for Philippines in ’24

The Asian Development Bank (ADB) kept its growth forecast for the Philippine economy at six per cent for 2024 and 6.2 per cent in 2025. Domestic demand, driven by lower inflation and interest rates, is expected to fuel the expansion in GDP.

The report, Asian Development Outlook (ADO) September 2024, attributes this positive outlook to moderating inflation, monetary easing, and sustained public spending on infrastructure projects.

ADB lowered its inflation forecast to 3.6 per cent in 2024 from its April estimate of 3.8 per cent, reflecting the continued decline in food prices due to reduced tariffs on rice imports. Inflation is projected to ease further to 3.2 per cent in 2025.

ADB Philippines Country Director Pavit Ramachandran expressed optimism about the Philippines’ economic prospects, citing rising government revenues, increased employment, and ongoing economic reforms.

While the outlook is positive, the report highlights potential risks such as severe weather events, a global economic slowdown, financial volatility, geopolitical tensions, and rising commodity prices.

The Philippine government’s infrastructure spending is expected to range between five per cent and six per cent of GDP annually from 2024 to 2028. The Build Better More programme includes 66 ongoing projects and 31 approved for implementation.

ADB is supporting key infrastructure projects in the Philippines, including the Malolos Clark Railway Project, South Commuter Railway Project, Bataan-Cavite Interlink Bridge Project, and Integrated Flood Resilience and Adaptation Project.

Attribution: Asian Development Bank report

Subediting: M. S. Salama