What’s the state of the Philippine Economy as we approach year two of the pandemic? Is this the year that we finally bounce back to pre-pandemic levels?
The news can be confusing, especially if you’re not well-versed in all that economic jargon. However, there is a way to discuss it, in a way that’s easier to understand. Here’s a brief 2022 PH Economic Forecast that we compiled from different sources. Hopefully this helps you understand what exactly is going on – and what you can do to actually help our economy.
We previously predicted that we were on the path to recovery in 2021. Despite all that happened last year, this fact remains true. The Philippines is in a strong position to rebound.
Our Economy’s Resiliency
However, despite this rosy forecast, the emergence of the Omicron variant has stalled the growth that the Philippines was expecting. In fact, the recent status of “Alert Level 3”, brought about by the surge in cases, is costing the Philippine economy almost ₱3 billion per week.
Economy Remains Open Despite Surge
Despite this ongoing surge, the 2022 PH economic forecast remains optimistic. For First Metro Investment Corporation (FMIC), this is due to the fact that despite the huge daily infection tallies, the economy remains open.
“We are mobile…That is really the result of our vaccination rate of 50 percent,” said FMIC Research Head Cristina Ulang. Adding that as long as vaccinations continue, the economy will remain on its path to recovery.
This is echoed by the ADB, as they have even upgraded their economic growth projections for the Philippines this year from 5.5% to 6%.
Bird again remains optimistic this 2022: “With the growth of 6 percent this year, we expect the Philippine economy to have fully recovered to its pre-pandemic 2019 level of GDP (gross domestic product), and we expect that to occur around the fourth quarter of this year,” he said.
All of this optimism stems from the fact that our economy’s recovery is seen to be driven again by a wider vaccination rollout, accommodative fiscal and monetary policies, and sustained public infrastructure spending.
Top Performer in the Region – But With a Caveat
In addition, the Philippine economy is even poised to become one of the top performers in the Asian Pacific Region according to the World Bank. However, this expected growth still falls short of government targets as downside risks remain.
“Growth in the Philippines is projected at 5.9 percent in 2022, supported by sustained public investment and recovering household consumption, and moderate to 5.7 percent in 2023,” said the World Bank. This is significantly lower than the government’s 7% – 9% target for 2022, and 6% – 7% for 2023.
Despite this, the World Bank said that the PH economy is projected to grow faster than its neighbors – Malaysia is at 5.8%, Vietnam is at 5.5%, and even China is only at 5.1%. In fact, the region’s GDP is seen to grow to only 5.1% this year.
Remain Optimistic, Yet Cautious
To summarize this 2022 PH Economic Forecast, we must be optimistic yet cautious. We’re not out of the woods yet. Even though we are on the path to recovery, we are still quite some ways away from the government’s targets this year.
The good news is that there is definitely something we can do to help ensure the recovery of our economy. Get vaccinated if you haven’t yet. Get boosters if you haven’t yet. Patronize and support local businesses to keep the economy moving. Continue to practice the minimum health protocols. All of these forecasts will be for nothing if we do not do our part to ensure that they happen.