An expected rebound in consumer spending this year will propel the Philippine economy to grow by 7.6 percent from a 9.5-percent contraction in 2020 due to the devastating and prolonged impact of the COVID-19 pandemic, Fitch Solutions, a unit of Fitch Group, said Tuesday.
“We hold a positive outlook for the Filipino consumer over 2021. We forecast real growth in household spending to post a growth of 5.7 percent year on year. This marks a start of a recovery from the -7.9-percent contraction in household spending estimated over 2020,” Fitch Solutions said in a report.
It said all of the main consumer spending categories would return to positive growth in 2021. It said food and non-alcoholic drink spending were prioritized in household budgets in 2020, and so growth in spending on these items, while remaining positive, would be slightly lower than in 2021.
“We forecast food and non-alcoholic drink spending to grow by 5.3 percent year on year in 2021, decelerating from the estimated 9.4 percent year on year growth in 2020,” it said.