World Bank revises Phl growth forecast for 2014, 2015

MANILA, Philippines - The World Bank revised its growth outlook for the Philippines in 2014 and 2015, taking into account the effects of typhoon Yolanda and the government's $8-billion reconstruction effort.

In its Philippine Economic Outlook published on Monday, the Washington-based lender said it expects the country's gross domestic product (GDP) to grow at 6.6 percent this year, down from its pre-Yolanda forecast of 6.7 percent. However, it upwardly revised 2015 GDP growth to 6.9 percent from the original 6.8 percent.

“The country is benefiting from a pro-poor government. Second, the country stands to benefit from the strong growth prospects of a dynamic East Asia region. Third, past the half way mark, the reform momentum of the Aquino Government is accelerating. And finally, there is a growing consensus among a broad spectrum of stakeholders that the current opportunity to enact reforms marks a critical juncture in the country’s history. By undertaking structural reforms now, the economy can move towards a more inclusive growth path and create more and better jobs for the majority of the population,” said Rogier van den Brink, World Bank Lead Economist for the Philippines.

Karl Kendrick Chua, World Bank Senior Economist for the Philippines and the report’s main author said the country continues to benefit from strong macroeconomic fundamentals, characterized by low and stable inflation, healthy external balances, and improving government finances.

Downside risks, however, can come from the anemic global economic recovery, the end of the United States Federal Reserve's quantitative easing and a slowdown in high-income economies and China.

The bank said addressing unemployment and ensuring efficient reconstruction in Visayas will help typhoon victims and mitigate future risks from disasters.

World Bank Country Director Motoo Konishi said the government's reconstruction effort will help build back better homes, schools, health facilities, utilities, infrastructure, and livelihoods destroyed by the super typhoon. 

“Over the coming years, a comprehensive agenda to support the revival of agriculture and manufacturing will further strengthen the country’s resilience to calamities. Reforms to secure property rights, enhance competition, simplify regulations, and increase investments in health, education, and infrastructure will make this happen,“Over the coming years, a comprehensive agenda to support the revival of agriculture and manufacturing will further strengthen the country’s resilience to calamities. Reforms to secure property rights, enhance competition, simplify regulations, and increase investments in health, education, and infrastructure will make this happen," Konishi said.

He added that poor Filipinos can be prepared for the rainy days if they have good jobs and are able to raise their incomes.