The Philippines will remain a top performing economy in Asia this 2016 despite the dry season and base effects, the Hong Kong and Shanghai Banking Corp. (HSBC) predicted in an Asian economic report.
The HSBC report titled “On top of the data; Brace for a long summer" cited the country’s 6.9 percent gross domestic product (GDP) output during the first quarter of 2016 which was marked by election-related spending.
The research explained how the growth of the domestic economy “was primary driven by investment and private consumption on the back of sustained government infrastructure spending, election campaign activity and strong remittances growth.”
The Asian economic report added, ”While the pace of growth will likely slow in the coming quarters after the election boost subsidies and the base effect turns less supportive, the Philippine economy should nonetheless remain a regional outperformer given the domestically-driven nature of growth.”
The HSBC report on the Philippines written by economist Joseph Incalcaterra, said HSBC economists “are particularly encouraged by the strong pedigree of the incoming (Duterte administration) economic team.”
The economist is referring to the President-elect’s announced choice of economic managers namely, Budget Secretary Benjamin Diokno, Finance Secretary Carlos Dominguez, and National Economic and Development Authority (NEDA) Director General Ernesto Pernia.
“We are particularly encouraged by the strong pedigree of the incoming economic team, which includes leaders from the business community, academics with past policy experience,” Incalcaterra added.
HSBC sees the country’s economy expanding 5.9 percent this year before slowing down to 5.8 percent next year.
The Philppines’ GDP growth this year is expected to be faster than Indonesia’s 4.9 percent, Malaysia’s four percent, Thailand’s three percent, Singapore’s 1.6 percent, and Taiwan’s 1.4 percent.