MANILA, Philippines – The Philippine government’s economic managers missed their growth targets in 2018. This year, they are confident that they can do better.
The country’s top economic experts are banking on legislative developments and several external conditions to spark growth and a better environment for doing business.
Finance Secretary Carlos Dominguez III recently told the business community in Japan that the Philippine economy’s resilience has been tested and proven strong.
He also highlighted that while the government missed its 7% to 8% growth target in 2018, the country’s economy has been growing at an average of 6.5% in the first 10 quarters of the Duterte administration.
Dominguez went on to highlight 6 factors why investors should bank on the Philippines:
Investments-led growth. Dominguez said foreign direct investments reached an unprecedented $10 billion in 2017 and $9.1 billion in the first 11 months of 2018.
He said this indicates that the country’s growth story is shifting from consumption to investments-led growth.
Investments in infrastructure. The finance chief said the infrastructure push and human capital development are complemented by prudent fiscal management.
Some of the big-ticket projects have broken ground, with the Metro Manila Subway being the most recent. Majority, however, are still under discussion.
Note as well that the government breached its spending cap, with the budget deficit reaching 3.2% or 2 percentage points higher than the target in 2018.
A comprehensive tax reform program. Dominguez said the Tax Reform for Acceleration and Inclusion law helped fund the infrastructure program and yielded benefits for Filipinos in the form of increased spending power, as indicated by the robust growth in sales and high profit margins of publicly listed retail giants and real estate companies in 2018.
