The Asian Development Bank (ADB) has recast its forecast for the Philippine economy to a deeper decline of 7.3 percent this year, citing subdued private consumption and investment amid the coronavirus pandemic.
In its Asian Development Outlook (ADO) 2020 Update, the Manila-based multilateral bank downgraded the outlook for the Philippines further from a forecast of a 3.8 percent full-year contraction in June and a slowdown of two percent in April.
However, ADB said the Philippines is expected to rebound next year to return to a growth path of 6.5 percent as the contagion is controlled, the economy opens further, and more government stimulus measures are implemented.
But it said the recovery would be challenged by downside risks such as a slower-than-expected global turnaround, thus weakening trade and investment, as well as remittances by overseas Filipino workers.
ADB’s latest forecast on the performance of the Philippine economy for this year and the next is aligned with the government’s own expectations of a contraction of as much as 6.6 percent this year and a rebound of between 5.5 and 6.5 percent next year.
This assumes that the gradual recovery in activity will continue in step with the reopening of the economy and that community quarantine restrictions would no longer be tightened.
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