The Washington-based global financial industry association Institute of International Finance (IIF) expects the Philippines’ economic growth to slow to just 2.6 percent in the first quarter of 2020, while expansion across Asia amid the COVID-19 pandemic would fall to its lowest since the 1997-1998 Asian financial crisis.
In a March 24 report titled “EM Asia And LatAm Growth Under COVID-19,” the IIF nonetheless projected Philippine gross domestic product (GDP) growth climbing to 6.2 percent year-on-year by the third quarter of 2020.
The government targets 6.5-7.5 percent growth this year, but estimates of the state planning agency National Economic and Development Authority (Neda) had shown full-year GDP could expand by a slower 4.3 percent at most, or, in the worst case, contract by 0.6 percent amid the COVID-19 pandemic.
Across the seven Asian countries covered by the IIF report, which also included China, India, Indonesia, Malaysia, South Korea and Thailand, first-quarter growth was projected to average 2.4 percent.
By the third quarter, GDP expansion will be a faster 5.5 percent across these seven countries.
The report said emerging market growth in Asia and Latin America was likely to “suffer heavily” from a combination of factors—low prices, loss of jobs and recession in major economies.
The IIF report said recovery could come in the second half of 2020.
It said while it was not expecting recession in emerging Asian markets, it was forecasting “the lowest growth rate since the Asian financial crisis” partly because of a slowdown in the Chinese economy.
It said effects of low growth in China on emerging Asian markets would likely allow “gradual recovery” but the forecast growth would be just 1.6 to 4.5 percent.
Edited by TSB
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.