A bank economist said Wednesday he expects the Philippine economy to grow modestly by 5 percent this year, as the country is one of the jurisdictions in the region expected that might have a delayed recovery from the devastating impact of the global health crisis.
“We had previously priced-in a vaccine rollout to extend into second half of 2022 given the tight global supply and challenges for distribution to an archipelagic country. The lack of vaccine availability, persistent spread of new infections and the ongoing economic recession have all combined to deflate once-vibrant consumer sentiment,” ING Bank Manila senior economist Nicholas Mapa said Wednesday.
“With the labor market in tatters, remittances in contraction and cases on the rise, we continue to forecast that GDP will post a modest expansion in 2021 (5 percent), driven primarily by favorable base effects from last year’s tumble of 9.5 percent,” he said.
He said the recent rapid acceleration in cases complicated the economic recovery, fueled in some parts by the entry of the new variants that would undermine the economic bounce back and sap even more momentum from the economy.
“Rising inflation and the threat of rising borrowing costs compound the challenges faced by Filipinos exponentially as 2021 is now starting to look a lot like 2020,” he said.
