GDP to grow 6.3% in 2018, 7% in 2019: BPI

Emilio Neri Jr., Vice President and lead economist at the Bank of the Philippine Islands (BPI), said full-year gross domestic product (GDP) will likely expand slower this year, but the economy will continue to grow much faster than many of its peers in Southeast Asia. (Photo: BPI/Facebook)

MANILA — The Philippine economy is expected to grow by 6.3 percent this year and accelerate close to 7 percent in 2019, underpinned by the government’s infrastructure push as well as election-related spending.

Emilio Neri Jr., Vice President and lead economist at the Bank of the Philippine Islands (BPI), said full-year gross domestic product (GDP) will likely expand slower this year, but the economy will continue to grow much faster than many of its peers in Southeast Asia.

He attributed the slower growth to temporary faster inflation brought about by an increase in oil prices and a decline in agricultural output due to unfavorable weather conditions.

“We are actually optimistic next year because it will be a mid-term election and typically, there is a lot more spending,” Neri said in a recent interview.

He noted that big-ticket infrastructure spending also have yet to happen.

“If the (Metro Manila) subway (project) happens, if the airport projects in Luzon actually ground break and pipelined next year, the investment numbers that we saw earlier will continue to increase,” he added.

The economist further said oil prices are expected to normalize next year, which can bring down the country’s inflation rate below 4 percent.

Higher food prices due to the devastation wrought by Typhoon ‘Ompong’ mainly pushed the country’s inflation rate to a nine-year high at 6.7 percent in September 2018.

The country’s GDP surged 6.7 percent in 2017.