According to the Philippine Commercial News: Due to strong private consumption, a rebound in exports and investment, and election-related spending, the Asian Development Bank (ADB) has raised its economic growth forecast for the Philippines this year from 3.3% to 3.8%.
In its 2010 Asian Development Outlook report, the ADB stated that the latest growth forecast remains below its potential. Prior to the global economic crisis that began in 2008, the average growth rate over the previous five years was 5.5%.
The ADB indicated that over the next two years, private consumption will likely remain the primary driver of economic growth in the Philippines due to continued growth in remittances, a more stable labor market, and increased consumer confidence. Meanwhile, election-related spending will also boost economic growth. The service sector will see strong growth, and as external demand rises, particularly for electronic products, the manufacturing sector will also gradually recover. By 2011, the Philippine economy is expected to grow by 4.6%.
However, HSBC also pointed out that there are still many uncertainties, as the economic and fiscal policies of the new government will have a significant impact on the momentum of economic growth.
