RP economy to recover at 3.5 percent next year – UN report

MANILA, Philippines – The Philippines and other major export-led economies are expected to experience substantial recovery next year, according to the United Nations.

In a yearend update report, the UN Economic and Social Commission for Asia and the Pacific (ESCAP) said recovery for the Philippines is expected at 3.5 percent; Singapore, 3.5 percent; Taiwan, 3.5 percent; Thailand, 3 percent and Malaysia 2.5 percent.

The Asia-Pacific region is leading the global economic recovery, with the growth rate in 2010 forecast at 6.3 percent – the highest in the world, according to the ESCAP’s “Economic and Social Survey of Asia and the Pacific 2009: Year-end Update.”

However, the report also found that considerable uncertainties remain about the extent and durability of the recovery, and that the region’s recovery depends very much on external factors.

Key to the region’s exports, for example, will be the recovery of demand in developed countries.

The report, which examines progress since the launch of ESCAP’s flagship publication in March, indicated China is forecast to experience the fastest growth in 2010, at 9 percent, driven by public and private investment.

The domestic-demand led economies of India and Indonesia are also forecast to grow fast, at 7.5 percent and 5 percent, respectively, driven by domestic consumption and investment, the report added.

It is too early to withdraw existing supportive policies, and encouraged greater intra-regional cooperation to improve the ability of countries to better weather such crises in the future, according to the report.

Nagesh Kumar, ESCAP’s chief economist, said the aftermath of the crisis has revealed the shifting axis of global growth to within the region and the need to devise regional supporting mechanisms through greater macroeconomic, trade and investment integration.

“Asia and the Pacific also must take a leading role commensurate with its importance in the global economy in discussions on reforming the international institutional and regulatory architecture,” he said. — Pia Lee-Brago, Philippine Star