The Philippines Economic Update (PEU)summarizes key economic and social developments, importantpolicy changes, and the evolution of external conditionsover the past six months. It also presents findings fromrecent World Bank analysis, situating them in the context ofthe country’s long-term development trends and assessingtheir implications for the country’s medium-term economicoutlook. The PEU covers issues ranging from macroeconomicmanagement, financial-market dynamics to the complexchallenges of poverty reduction and social development. Itis intended to serve the needs of a wide audience, includingpolicymakers, business leaders, private firms and investors,and analysts and professionals engaged in the social andeconomic development of the Philippines. Policymakers needto confront downside risks while fostering long-term growth.The short-term risks to the country’s outlook includeincreased trade protectionism, the possibility of financialmarket disruptions, and elevated economic policyuncertainty. In the longer term, weaker growth potentialremains the main risk. Consistency in the government’spolicies to achieve stable inflation, fiscal stability, andsecurity will help preserve consumer and businessconfidence. For the Filipino consumer, it will be importantthat inflation remains at moderate levels. This will warrantcareful inflation management by the central bank authoritiesto anchor expectations. As long as it is consistent withmedium-term fiscal sustainability, an expansionary fiscalpolicy could support short-term growth. The successful andtimely implementation of the government’s fiscal program,including its ambitious infrastructure plan and efforts togenerate more revenue, would signal a strong commitment tothe government’s policy priorities. Key issues, such asmining regulations and regional development in Mindanao,will require policy certainty to preserve both external anddomestic confidence in the Philippine economy. Implementingstructural policies that support investment and trade willbe critical to boost productivity and potential growth inthe long-term. These policies would require the government’scommitment to reforms that promote competition in keysectors, secure property rights, lessen regulatorycomplexities, and improve doing business in the country.Longer-term policy priorities also include training and jobsearch programs and other measures to support workers mostaffected by sectoral shifts in employment and share thedividends of growth and gains from globalization morewidely. Sustained investment in human capital developmentand in sectors that create quality employment are needed tosafeguard the country’s progress on delivering inclusiveness.
PDF
download
878987797
028-85220240
