In a market in Manila, the Philippines (Photo: AFP/VNA) Hanoi (VNA) - ANZ Research predicts that the Philippine economy will fall 9.2 percent in the second half of 2020 as the economy is likely to book a double-digit contraction in the third quarter due to the coronavirus pandemic.
ANZ Research expects the Philippines’ GDP would contract by 11.5 percent in the third quarter and by 7.1 percent in the fourth quarter.
Kanika Bhatnagar, economist at ANZ Research, said as a result, the economy is now expected to contract by 9.1 percent this year, a reversal of the six percent growth in 2019.
The economy stalled after Luzon was placed under enhanced community quarantine in the middle of March. The lockdown was relaxed as the National Capital Region (NCR) shifted to general community quarantine in June.
However, Metro Manila and nearby provinces reverted to stricter modified enhanced community quarantine from August 4 to 18 as COVID-19 cases surged.
The economist also cited the unprecedented fall in remittances due to the repatriation of overseas Filipino workers, a surge in unemployment rate to a record 17.7 percent as well as slow fiscal delivery.
In addition, Bhatnagar noted the limited efficacy of monetary policy even if the Philippines’ central bank (BSP) slashed interest rates by a cumulative 175 basis points to a record low of 2.25 percent so far this year and lowered the reserve requirement ratio./.
VNA
