The country’s economic expansion for 2022 is expected to be at least one percentage point higher versus last year’s growth, according to the latest report of the Market Call.
The report published by First Metro Investment Corp. and the University of Asia and the Pacific said robust economic data have boosted optimism among firms and consumers.
“GDP (gross domestic product) growth in 2022 should take a faster pace, by at least one percentage point to six percent to seven percent,” the report said.
“2021 GDP was reported at 5.6 percent, this should accelerate by another one percentage point at least with the growth momentum in place reinforced by heavy election spending in H1-2022,” it added.
The report said the November employment figures provided the biggest boost to this optimism as it added 1.6 million jobs to reach a record total employment of 45.5 million.
“While a slight correction may occur in December, the excited reopening of businesses and consumer spending seen in malls and restaurants should provide the needed impetus for the economic recovery gaining traction,” the Market Call said.
The report also projects full-year inflation at 3.7 percent despite elevated crude oil prices, as food prices have stabilized in the recent months.
“National government expenditures in 2022 should outperform, as infrastructure spending ratchets up,” the Marker Call said.
“While the peso slightly appreciated in December, the gains have vanished in 2022 with record trade deficits and likely hikes in interest rates in the US, and the USD-PHP (US dollar to Philippine peso) staying above P51/$1 and likely to remain there for most of 2022,” it added.
Meanwhile, in an economic bulletin released yesterday, the Department of Finance (DOF) said the growth momentum needs to be sustained even in the face of the continued threat from the coronavirus pandemic and its variants.
“The country needs to continue managing the risks, either through pharmaceutical or non-pharmaceutical means,” the DOF said.
The agency added the recent approval of the amendments to the Retail Trade Liberalization Act is a step in the right direction.
“We continue working with Congress to amend the Public Service Act and Foreign Investments Act. These game-changing economic reforms, together with the ongoing infrastructure program and Corporate Recovery and Tax Incentives for Enterprises Act, will have formed an economic recovery cocktail that can deliver a big shot in the arm of the Philippine economy,” the DOF said.
“This will continue the investment-led growth, generate more employment, and, possibly, increase real wages,” it added. – Angela Celis
