Illustrative image (Photo: Philstar.com) Hanoi (VNA) – The International Monetary Fund (IMF) hasslashed its growth outlook for the Philippines for 2020 from 6.3 percent to 0.6percent due to the impact of the coronavirus disease 2019 (COVID-19).
Despitethe big drop in its projection, the lender forecasts a recovery of the domesticeconomy in 2021, with an expansion of 7.6 percent.
Theseprojections are in line with its 0.6-percent growth forecast for ASEAN-5 forthis year and 7.8 percent next year.
IMFCountry Representative to the Philippines Yongzheng Yang attributed the cut intheir growth projections for the country to supply disruptions related to COVID-19and weaker demand in the Philippines’ major trading partners.
Tighterglobal financial conditions, weaker public confidence, and lower remittancesare also expected to weigh on private consumption and investment, Yang said.
He,however, said these factors are seen to be countered partly by policy support.
The Philippinegovernment has formulated fiscal and monetary measures worth 1.1 trillion PHP (21.7billion USD) to help sectors affected by the pandemic while various levels ofquarantine have been raised nationwide to curb the further rise of COVID-19cases.
Yang saidstemming the spread of COVID-19 is of utmost importance, and policies at themoment should focus on both protecting public health and putting people back towork.
He said the IMF welcomes the Philippine government’s measures to addressthe pandemic’s impact.
He notedthat because of prudent macroeconomic management, the Philippines has builtconsiderable policy buffers in recent years, and both the government and the centralbank have been making good use of this policy space.
"Thecountry has ample room for additional policy stimulus, if needed, given therelatively low level of public debt and well-anchored inflation expectations,”Yang said./.
VNA
