Romualdez: PH economy resilient despite global slowdown, inflation to ease in coming years
MANILA, Philippines — House Speaker Ferdinand Martin Romualdez has assured businesspeople that the country’s economy would remain vibrant despite a global slowdown, while inflation would ease in 2024 and 2025 based on latest predictions from experts.
In his message during the Forum on Legislative Reforms for the Philippines Capital Market on Wednesday morning at the Philippine Stock Exchange Tower in Taguig, Romualdez cited the World Bank’s bright outlook — even with a trimmed expected gross domestic product (GDP) growth rate due to high inflation rates.
“I begin with news that, despite some challenges, latest developments in the economic front continue to imbue us with optimism. The World Bank has recently projected the Philippines to be the fastest-growing economy in Southeast Asia this year. Yes, they’ve trimmed our GDP growth projection due to persistent inflation and global headwinds, but this revised 5.6% growth remains commendable, especially when viewed in the context of the Southeast Asian region,” he said.
“While factors such as the global economic slowdown and external environments have posed challenges, the resilience and adaptability of our economy persist. For context, our growth this year is anticipated to surpass that of nations like Indonesia, Vietnam, and Malaysia. By 2025, the World Bank forecasts our GDP growth to average 5.7%, buttressed by domestic demand and declining inflation,” he added.
According to Romualdez, the Philippine economy has shown signs of being able to bounce back since the slow GDP growth for the second quarter — at 4.3 percent — did not affect the 5.3 percent average growth for the first half of 2023.
While inflation is a big challenge to the government, Romualdez said headline rates are seen to slow down by 2024 and 2025.
“This speaks volumes about the latent potential within our economy and capital markets, as we endeavor to achieve our ambitious target growth rate of 6-7%. Furthermore, our previous figure of a 4.3% GDP growth for the second quarter, though the slowest in over two years, averaged a growth of 5.3% for the first half, indicating our ability to rebound and adapt,” the Speaker explained.
“However, challenges remain, notably the need to manage inflation, which the World Bank projects to average 5.9% this year. Yet, the silver lining is the expectation that it will ease to 3.6% by 2024 and further to 3% by 2025,” he added.
Romualdez also mentioned several laws and bills that Congress is working on, to ensure that the country’s economy remains sturdy:
- Amended Public Service Act
- Proposed Build-Operate-Transfer (BOT)/Public-Private Partnership (PPP) Act
- Proposed Fiscal Regime for the Mining Industry Act
- House Bill No. 4339 seeking to reform the country’s Tax Code
Romualdez has always been optimistic about the country’s economy: last July, the House Speaker said that the investment pledges received by the country is are a sign that foreign companies trust the potential of the Philippines as an investment arena.
Then last September 28, Romualdez said that an International Monetary Fund (IMF) team has given the Philippine economy a chance to catch up after a slow start in the first half of 2023.
However, minority lawmakers in the House — particularly those from the Makabayan bloc — have downplayed claims of a strong economy, citing a bad inflation spate and the supposedly misinformed solutions from the government.