The Philippines, the fastest-growing economy in the Association of Southeast Asian Nations (ASEAN) last year, is expected to keep its status in 2024 and 2025, according to a regional organization.
After growing 5.6 percent in 2023, the Philippines is forecast to expand 6.3 percent in 2024 and 6.5 percent in 2025, the ASEAN+3 Macroeconomic Research Office (AMRO) said in a report Monday.
This will be faster than the predicted regional average growth of 4.8 percent in 2024 and 4.9 percent in 2025.
The Philippine economy is expected to outpace Cambodia’s growth of 6.2 percent this year, Vietnam’s 6.0 percent, Indonesia’s 5.2 percent, Malaysia’s 5.0 percent, Lao’s 4.7 percent, Thailand’s 2.9 percent, Brunei’s 2.7 percent and Singapore’s 2.6 percent
Meanwhile, China is seen growing 5.3 percent in 2024; Hong Kong, 3.5 percent; Korea, 2.3 percent; and Japan, 1.1 percent
AMRO’s GDP growth projections for the Philippines are within the Development Budget Coordination Committee’s revised economic target of 6 percent to 7 percent this year and 6.5 percent to 7.5 percent in 2025.
“The stronger growth for ASEAN+3 this year will be mainly driven by robust domestic demand, underpinned by increasing household incomes and recovering investment activity. The anticipated turnaround in exports, in part due to the global chips upcycle, and the continued recovery of tourism will provide additional tailwinds,” AMRO said.
It also said that with global commodity prices continuing to stabilize, inflation in ASEAN+3—excluding Lao PDR and Myanmar—is expected to moderate from 2.8 percent last year to 2.5 percent in 2024, before easing further to 2.3 percent in 2025.
AMRO warned, however, against taking the region’s positive momentum for granted in light of potential disruptors to the growth trajectory.
“A sudden spike in global commodity prices, weaker-than-expected growth in China, or escalating geopolitical tensions could turn the tide for the region,” said AMRO chief economist Hoe Ee Khor.
“Now that the current outlook is quite positive, given robust growth and gradual disinflation, ASEAN+3 economies need to rebuild policy space as much as they can,” Khor said.
Khor said revitalizing growth requires boosting investment and embracing technology to raise productivity and resilience, especially of smaller firms.