Up to 7.5% Economic Growth Rate Eyed for the Philippines in 2020

Foreign investors are optimistic on the Philippines’ potential to be one of the leading markets in the coming years given its push to develop infrastructure, strong domestic spending, and affordable yet quality labor - PCCI

According to International Monetary Fund estimates, global economic growth rate for 2020 is projected at 3.4 percent. Last year, global economies only grew 3 percent which was the lowest since year-end of 2019. Trade barriers, geopolitical issues, and rising production costs are among factors that contribute to the slow and stagnant growth of world markets.

The opposite can be said for the Philippines – with an average economic growth rate of around 6.47 percent since 2012 – the National Economic Development Agency (NEDA) and other agencies such as the World Bank and the Asian Development Bank are optimistic on an economic growth rate of up to 7.5 percent annually from 2019 to 2022 for the Philippines, which would be fueled by infrastructure development and investments in human capital.

The Federation of Filipino-Chinese Chambers of Commerce (FFCCCPI) President, Dr. Henry Lim Bon Liong, reiterated their statement released last December 2019 on their projection of a Philippine economic growth of 6.5%-7.5% or higher in the coming years.

He cited revenue from the tourism sector as a main contributor to the national economy wherein around 5.4 million Filipinos are employed. Easing tensions between economic powerhouses – US and China, and revamped global trade laws would also lift the pressure on states caught between trade wars between these nations. It was also said that despite trade wars, the Philippines would not be affected heavily by the feud since the country's economy is primarily reliant on domestic consumption and remittances.

Chairperson of the Philippine Chamber of Commerce and Industry (PCCI), Ms. Alegria Sibal-Limjoco, said that foreign investors are optimistic on the Philippines’ potential to be one of the leading markets in the coming years given its push to develop infrastructure, strong domestic spending, and affordable yet quality labor. Ms. Limjoco highlighted that industries such as agriculture and business which are environmentally sustainable and inclusive are areas of interest by foreign investors.

Lastly, the demands of a growing economy include a strong, skilled, and capable workforce. Unemployment rate in the Philippines has been on a decline from 6.6 percent at the start of 2017 to 5.1 percent at the end of the last quarter of 2019. Despite that, the lack of skilled and technical labor has been reported due to better opportunities primarily wages in other countries. The PCCI and FFCCCPI said that they have been supporting programs offered by TESDA to bridge Filipinos to proper technical occupations.

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