By: Philippine Star
The economy may contract anew in the first quarter, further extending the pandemic-induced recession, according to economists.
Bank of the Philippine Islands chief economist Jun Neri said the country’s gross domestic product (GDP) may contract mildly in the first quarter. “It seems consumer confidence is starting to show a more meaningful recovery based on the mobility data in the last six weeks of 2020. Combined with some easing in transport protocols, consumers have learned to take the necessary precautions to confidently go out.”
He also said consumer spending may recover faster this year as the use of online shopping apps has also become widespread and has broken records.
According to Neri, the economy is expected to grow by 6.8 percent this year after slumping to a record 9.5 percent in 2020 as the economy stalled when Luzon was placed under enhanced community quarantine in mid-March to slow the spread of the virus.
“However, even at this brisk pace, economic output will not be able to return to the 2019 level yet, and a full recovery may only happen in 2022. On the other hand, uncertainties still remain and another lockdown may prevent the economy from reaching more than six percent growth,” Neri said.
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