THE PHILIPPINE ECONOMY is expected to grow at 4.2% this year as stricter restriction measures due to rising coronavirus disease 2019 (COVID-19) cases are seen to dent recovery, ANZ Research said.
The firm’s new gross domestic product (GDP) growth forecast is slower than the 4.8% estimate it gave previously and is also below the government’s 6-7% target.
ANZ Research’s forecast for the Philippines is better than its outlook for Indonesia (3.8%), Malaysia (4%), and Thailand (1%). Only its projection for Singapore was retained in this report at 6.6%, with the firm saying that growth indicators in the country are still within expectations despite restriction measures there.
The six Southeast Asian economies are now expected to grow by 3.9% in 2021, slower than the previous estimate of 4.6%.
Meanwhile, ANZ Research expects the Philippine economy to expand by 6.2% in 2022, also slower than the 6.5% forecast it gave earlier.
The economy contracted by 9.6% in 2020, the steepest drop seen in Southeast Asia. The economy remains in recession as GDP shrank by 4.2% in the first quarter.
The Philippine Statistics Authority will report the second quarter GDP data on Aug. 10.
Intensified restrictions in Southeast Asia have caused “substantive damage to the recovery,” ANZ Research Chief Economist for Southeast Asia and India Sanjay Mathur said in a note on Friday.
He particularly noted that restrictions in the Philippines, Indonesia, and Malaysia are “routinely reimposed or extended”.
“The channels through which the recovery is being impacted are well-known — diminished consumer confidence, excessive slack in the service industries such as recreation and tourism, and the waning efficacy of expansionary fiscal and monetary policies,” Mr. Mathur said.
Metro Manila and other provinces where cases are spiking are under the strictest form of lockdown from Aug. 6 to 20 to curb the further spread of the more infectious Delta variant of COVID-19.
Socioeconomic Planning Secretary Karl Kendrick T. Chua said last week that the two-week Metro Manila lockdown alone could cause the country to lose more than P200 billion.
As many as 177,000 Filipinos are also expected to sink into poverty and 444,000 could lose their jobs, he said, citing estimates from the National Economic and Development Authority. — L.W.T. Noble