Gov’t warned against signs of economic headwinds

ShutterStock image

MANILA — Bank analysts noted how the slow-down in remittances and the weakness in the manufacturing sector may signal a further moderation of the country’s economic growth.

The economy grew by only 5.2 percent in January to March, lower than the government’s target of atleast 7 percent.

“Execution of the fiscal program is quite critical.

A poor report would raise concerns about the economy’s growth prospects,” Joey Cuyegkeng, economist at ING Bank’s Manila office, said as quoted in a Philippine Daily Inquirer report by Paolo Montecillo.

This slowdown is attributed to the weaknesses in both the remittances coming from the overseas Filipino workers and the dismal growth of the manufacturing industry.

Remittances grew by only 5.1 percent this year, slower than the 11.3-percent expansion in March.

“Aside from remittances and the impact on consumption, the recent slowing in the export data raises concerns,” JP Morgan said the same PDI report.

The country’s exports also showed weakness from the previous forecast of an 8-percent gain to only 4.1-percent.

“If the slowing persists, this could spillover into softer fixed investment into plant and equipment,” said Sin Ben Ong, JP Morgan’s economist for Southeast Asia.