MANILA – The Philippine economic growth is expected to pick up its pace this year due to an increase in public spending, an analyst said Monday.
Ramon Tejero of Maybank ATR Kim Eng Securities said the country’s gross domestic product (GDP) is seen to grow by around 7 percent in 2015, much higher than its forecast for 2014 of 5.8 percent.
“We think that full-year GDP 2014 would come around 5.8 percent. This year, 2015, we forecast GDP growth to be around 7 percent. We think there’s going to be an improvement in GDP growth primarily because of more government spending,” Tejero told ANC.
Tejero said the GDP will also get a boost from the removal of the daytime truck ban in Manila, which Tejero said “has hurt the economy.”
“We think moving forward, that will bode well for the Philippine economy,” he said.
He added that lower oil prices can translate to better consuming patterns.
Maybank’s forecasts differ from HSBC’s, which projected growth to slow to 5.7 percent last year and to slow further to 5.4 percent this year.
HSBC said the slow GDP growth in both years will likely be the result of low government spending and lesser investments ahead of the 2016 election.
Government set a target range of 6.5 percent to 7.5 percent growth in 2014, and a target range of 7 to 8 percent in 2015.
Tejero also noted that earnings growth is expected to recover to around 15 percent in 2015, up from the projected 5 percent earnings growth in 2014.
He said Maybank is bullish on consumer and property sector stocks this year. –ABS-CBNnews.com
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