BCN-26 World Bank downgrades Philippine economic outlook for 2018

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ZCZC

BCN-26

WB-PHILIPPINE-ECONOMY-OUTLOOK

World Bank downgrades Philippine economic outlook for 2018

MANILA, Oct. 5, 2018 (BSS/Xinhua) – The World Bank downgraded on Thursday
its economic growth prospects for the Philippines for 2018 to 6.5 percent
from the earlier forecast of 6.7 percent amid slower-than-expected growth in
the first six months of this year.

The report named Philippine Economic Update released by the World Bank
said that “heightened global market uncertainty and rising domestic inflation
weighed on the Philippine economy in the first half of 2018.”

“The Philippines’ economic growth outlook remains positive, yet downside
risks have increased.” the report pointed out.

The report added that an expected slowdown in global trade in the medium
term is likely to further dampen Philippine exports.

Nevertheless, the report said baseline economic growth is projected at 6.5
percent in 2018, 6.7 percent in 2019, and 6.6 percent in 2020.

The report also cautioned that persistent high domestic inflation could
have a dampening effect on consumption and investment growth.

To manage these risks, Mara Warwick, the World Bank Country Director for
Brunei Darussalam, Malaysia, Philippines and Thailand, said that “maintaining
strong macroeconomic fundamentals is key.”

“At the same time, accelerating structural reforms to improve investments
in physical infrastructure and make better use of capital, labor, and
technology to increase productivity remains a very important agenda for the
Philippines,” Warwick said.

In the long-term, Warwick said “sustaining high productivity growth is
critical for the country to become a prosperous society free of poverty.”

To the World Bank report, the Philippine Presidential Spokesman Harry
Roque responded that the government “respect the lowering of the forecast”.

“We note that the lowering is not really a major lowering. It’s (zero)
point two. We expect the Philippine economy to still grow at a very robust
growth rate of 6.5,” he said.

Earlier, the Asian Development Bank (ADB) and the International Monetary
Fund (IMF) both lowered the Philippines’ gross domestic product (GDP) growth
forecasts in 2018.

BSS/XINHUA/HR/1135