IMF cuts growth estimates for Philippines

According to media reports, the International Monetary Fund (IMF) lowered its growth estimate for the Philippines for this year to 6% from its earlier estimates of 6.3% while maintaining its projections for 2017 at 6.2%.

The agency reported the Philippines’ economy still has a bright outlook; however volatile global markets and weak external demand, especially from the persistently slowing Chinese economy, are putting downward risks on the economy. However, according to the IMF, stronger domestic demand will continue to help offset the effects of negative external factors.

In 2015, the country’s economic growth slowed to 5.8% from a growth rate of 6.1% in 2014 in the face of weak external demand and lower government spending. However, the Philippines’ economic growth in the final quarter of last year accelerated to 6.3% from a revised growth rate of 6.1% in the previous quarter. In line with stronger growth in the September- December period, the country’s inflation declined to a 20 year low of 1.4% in 2015 from 4.1% in 2014 on the back of stable food prices and cheaper utility rates.