PHL economy to grow slower in 2019, says think tank

The Philippine economy is seen to grow slower than last year amid domestic headwinds such as the delay in the passage of 2019 budget and the effects of El Niño, according to think tank Foundation for Economic Freedom (FEF).

"Growth should be between 5.8 percent to 6.2 percent, more likely lower than last year," FEF president Calixto Chikiamco said during the Security Bank Economic forum in Makati City on Wednesday.

The country's economic growth slowed to 6.2 percent in 2018, lower than the 6.7 percent in 2017 and behind the already downward revised government target range of 6.5 to 6.9 percent.

For this year, the government is targeting a full-year gross domestic product (GDP) print of 6 to 7 percent.

While election spending is seen to boost economic activity, Chikiamco said that budget delay, export slowdown, higher interest rates, higher oil prices, increasing current account deficit, the El Niño phenomenon, the measles outbreak, and the water shortage were among the headwinds to growth for 2019.

"Inflation will moderate in 2019 but growth will decelerate to slightly below 6.2 percent. However, growth should still be between 5 to 7 percent in the next few years, depending on further economic measures," Chikiamco said.

"Lower agricultural productivity and an undiversified export base will remain drag to the Philippine economy. Increased growth, however, will have minimal impact on poverty without the increases in agricultural and manufacturing growth," he said. —LDF, GMA News