Updated 13:30 PM PHT Mon, April 24, 2017
Metro Manila (CNN Philippines, April 19) — The International Monetary Fund (IMF) sees robust growth for the country this year and next, citing strong domestic demand, recovery in exports, and higher public spending.
According to its 2017 World Economic Outlook report, it expects Gross Domestic Product (GDP) maintained at 6.8 percent this year and even higher at 6.9 percent in 2018, still one of the fastest growing in Asia.
"(The Philippines) growth is projected to remain robust at 6.8 percent in 2017 and 6.9 percent in 2018, led by strong domestic demand and a recovery in exports. Higher commodity prices will push up higher inflation (3.6 percent in 2017 and 3.3 percent in 2018), although still within the BSP's target range of 3±1 percent," Shanaka Jay Peiris, IMF resident representative, said in a statement.
"Public spending is expected to rise as the fiscal deficit target has been increased to 3 percent of GDP in 2017 and provide a stimulus to economic activity. The external position of the Philippines will continue to be comfortable," he said.
Finance Secretary Carlos Dominguez had said the country's infrastructure remains below regional standards. The government currently spends 5.4 percent of its GDP on infrastructure.
On Tuesday, economic managers launched "Dutertenomics" an economic program that's anchored on building key infrastructure.
Dominguez said the proposed comprehensive tax reform bill IS a key factor to this economic agenda.
He described this as a "key link in the grand effort to break out from the cycle of low growth and build a dynamic and inclusive economy".
The IMF report said the Philippine economy will lead in terms of growth in the next two years in Southeast Asia, outpacing Vietnam, Indonesia, Thailand and Malaysia,
In emerging and developing Asia, the Philippines will grow faster than China, which is seen to grow at 6.6 percent this year and lower at 6.2 percent next year.
The IMF's projection for the country compares with the World Bank's 6.9 percent forecast this year, even higher than Asian Development Bank's 6.4 percent.
The growth forecasts fall within the government's goal of 6.5 percent to 7.5 percent this year.