The World Bank said on Wednesday that the Philippine economy – which was seen as on track last year – is likely to underperform this year and next due to a sharp and prolonged global slowdown. He warned that the world was on the brink of recession as financial conditions deteriorated due to high inflation, monetary tightening, and the war in Ukraine. While many countries, especially developed ones, likely experienced slowdowns in the past year, the World Bank said the Philippines – along with a number of East Asian and Pacific countries – performed better than expected as economic reopening led to Increase private consumption and increase exports. The 2022 growth estimate for the Philippines was later upgraded to 7.2 percent, up from the 5.7 percent projected in June and just below the upper end of the government’s target of 6.5 to 7.5 percent. GDP growth in 2021 was 5.7 percent, up from the 2020’s 9.5 percent contraction. As of September of this year, expansion was already above target at 7.7 percent. Official results for the full year are due later this month, but countries that saw last year’s gains are expected to be restrained in economic activity this year as prices for food, energy and other key inputs continue to rise and monetary authorities remain in check. To deal with high inflation. “After a strong recovery in 2022, growth is expected to moderate in Malaysia, the Philippines and Vietnam as export growth to major markets slows,” said the World Bank. The country’s growth in 2023 is expected to slow to 5.4 percent, down from a June forecast of 5.6 percent and below the government’s target of 6.0 to 7.0 percent for the year. The forecast for 2024 was raised to 5.9 percent, above the 5.6 percent previously estimated but still below the official 2024-2028 target of 6.5-8.0 percent.
Regional Outlook Growth in East Asia and the Pacific likely slowed to 3.2% last year, down from the 4.4% expected in June, “almost because of China” where growth was expected to slow to 2.7%. It is estimated that the region’s gross domestic product, the East Asia and Pacific economy, expanded by 5.6 percent, 0.8 percentage points better than the June forecast. However, the forecasts for 2023 and 2024 were trimmed by 0.7 percentage points to 4.3 percent and 5.0 percent. Respectively, the World Bank said: “In the region excluding China, growth is expected to slow as pent-up demand dissipates and lower merchandise export growth outweighs the delayed recovery in travel and tourism.” Output in 2023 is well below pre-pandemic trends, the report added. h is expected to rise to 4.3 percent and 4.9 percent this year and next, down from 5.2 percent and 5.1 percent in June. “The outlook is subject to multiple downside risks,” the World Bank said. Inflation could lead to significantly more monetary tightening than currently expected. The report added that the tightening of global financial conditions could lead to a debt crisis, especially in countries with high levels of debt and the need for significant external financing. [also] It leads to costly disasters, especially for small countries.” percent and 2.7 percent, respectively, from 3.0 percent previously for both years.