AMRO still sees ’24, ’25 PHL growth topping 6%
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ESPITE the recent increase in inflation and the lowering of the government’s economic growth targets, the Asean+3 Macroeconomic Research Office (AMRO) still expects the Philippine economy’s growth to exceed six percent this year and next year. In its Asean+3 Regional Economic Outlook (AREO) 2024, AMRO said the Philippine economy is still expected to post a 6.3 percent growth this year, the same projection it made in January 2024. But AMRO said this growth is expected to continue in 2025 as indicators point toward an
economic growth of 6.5 percent. AMRO Chief Economist Hoe Ee Khor said growth will be driven by external demand and tourism recovery. “I think our forecast is 6.3 percent for this year and lower than the official target, but to us I think 6.3 percent is a very strong growth, among the highest in the region. The Philippines will also benefit from the upswing in terms of the external demand and we mentioned earlier that the manufacturing sector will benefit from that and also the recovery in tourism,” Khor said. Khor noted that higher demand
for Philippine products will boost manufacturing growth while recent reports stated that foreign tourism in the Philippines is now contributing more to tourism compared to domestic tourism. Despite higher prices being a threat to growth, AMRO expects inflation to remain within the Bangko Sentral ng Pilipinas (BSP) inflation target of 2 to 4 percent this year and next year. Based on the AREO, inflation in the country is expected to average 3.6 percent this year and even lower at 2.9 percent next year. “A sudden spike in global commodity prices, weaker-than-
expected growth in China, or escalating geopolitical tensions could turn the tide for the region,” Khor said. “Now that the current outlook is quite positive, given robust growth and gradual disinflation, Asean+3 economies need to rebuild policy space as much as they can,” he added. AMRO staff now forecast the Asean+3 economies to grow at 4.5 percent this year from 4.3 percent in 2023. AMRO also released today its 2025 growth forecast, with the region projected to expand by 4.2 percent.
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INFLATION MAY PROMPT RATE CUTS DELAY TO ‘25 w
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Tuesday, April 9, 2024 Vol. 19 No. 175
P25.00 nationwide | 2 sections 24 pages |
By Cai U. Ordinario
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@caiordinario
HE Bangko Sentral ng Pilipinas (BSP) could delay any rate cuts to the first quarter of 2025, pending improvements in the country’s economic performance, including cooler inflation. On Monday, the Monetary Board decided to retain the BSP’s Target Reverse Repurchase (RRP) Rate at 6.5 percent. With this, interest rates on the overnight deposit and lending facilities also remain at 6 percent and 7 percent, respectively. BSP Governor and Monetary Board Chairman Eli M. Remolona Jr. said they are more hawkish than before given the 3.7 percent inflation print in March 2024. This prompted the MB to raise its risk-adjusted inflation forecast to 4 percent this year from the initial 3.9 percent in January 2024. “Yung headline, that’s slightly better than expected. But then we faced the usual supply-side shocks that formed the upside risks that we worry about. And those are very significant,” Remolona said in a briefing on Monday. See “Inflation,” A2
WARM CONDITIONS Pagasa Weather Forecaster Melvin Tena monitors warm conditions at NAIA Terminal 1, attributing them to easterly winds which are influenced by broader factors like climate change or El Niño phenomena. This observation underscores the intricate interplay between regional weather patterns and global environmental trends, highlighting the ongoing need for meteorological monitoring and analysis in our ever-changing climate landscape. NONIE REYES
PBED’S ISSUE: HOW TO SHIELD EDUCATION FROM POLITICS? By Andrea E. San Juan @andreasanjuan
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HE government should put in place a system that has “checks and balances” to decentralize the education system in the country, according to Philippine Business for Education (PBEd), a business-led education advocacy group. Acknowledging that there may be challenges associated with devolving or decentralizing the country’s education system, PBEd Executive Director Justine Raagas underscored the need for the government to set up a
mechanism that prevents the Philippine education system from being tainted by politics. “It’s true that there are potential challenges and risks to devolving or decentralizing education system and we’re cognizant that that might be a risk—being politicized,” PBEd Executive Director Justine Raagas told reporters on the sidelines of PBEd’s General Membership Meeting in Makati City on Monday. “But if I think if we do have a system that has checks and balances in place, if we have a system with a very clear vision See “PBED’S,” A2
PBBM: LGUs should take lead in El Niño response By Samuel P. Medenilla @sam_medenilla
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ITH the varying impacts of El Niño on each region, President Ferdinand R. Marcos Jr. said local government units (LGU) should take the lead in declaring a state of calamity due to water shortages. A nationwide state of calamity by the national government is unnecessary for now, he explained, since water supply in some parts of the country are still “not critical.” “The problems faced by each area are different. It can’t be a shotgun [response] or one-size-fits all...we look at each area
and see what it is that they need. So, that’s what we are [doing], that’s the way we are handling local state of calamity that the local governments are declaring,” Marcos said in an interview with reporters in Negros Occidental on Monday. The Philippine Atmospheric, Geophysical and Astronomical Services Administration (Pagasa) projected that the number of provinces with drought—the status when an area has below normal rain conditions for five consecutive months or way below rainfall conditions for three consecutive months—is expected to increase to 48 this month from 37 last March. See “PBBM,” A2
PESO EXCHANGE RATES n US 56.5740 n JAPAN 0.3732 n UK 71.4699 n HK 7.2262 n CHINA 7.8227 n SINGAPORE 41.9315 n AUSTRALIA 37.1861 n EU 61.3262 n KOREA 0.0419 n SAUDI ARABIA 15.0832 Source: BSP (April 8, 2024)