The Asian Development Bank has upgraded the Philippines growth outlook this year from 6.5% to 6.7% and from 6.7% to 6.8% in 2018.
The Manila-based ADB said strong household consumption, manageable inflation and infrastructure investment are the factors for the improving growth data.
“The government is on track to achieve its target of spending 5.3 percent of GDP on public infrastructure this year. Household consumption remained strong despite moderating slightly from last year,” the ADB said.
The multilateral bank agency said the recovery of exports in the first nine months of the year as well as the strong contribution of services and manufacturing to the economy also factored into the higher growth forecast.
“This outlook assumes that growth in the government’s infrastructure program will accelerate, supported by improvements in budget execution, with more large investment projects underway,” the ADB stressed.
Growth projections in Southeast Asia—the country’s immediate neighborhood—was likewise raised to 5.2 percent this year from five percent in September and 5.2 percent in 2018 from the previous projection of 5.1 percent.
ADB said the subregion is benefitting from stronger investments and exports with growth emanating from Brunei, Malaysia, Philippines, Singapore and Thailand.
“Infrastructure investment continued to play an important role in Indonesia, the Philippines and Thailand. Robust domestic demand—particularly private consumption and investment—will continue to support growth in the subregion,” said the report.
ADB likewise hiked its growth projections for developing asia this year to six percent from 5.9 percent in September but retained its growth forecast of 5.9 percent for 2018.