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Philippines Economic Update : Resuming Public Investment, Fast Tracking Implementation (English)

Philippine economic growth slowed to its lowest level in eight years, driven by a rapid deceleration in investment growth in the first half of 2019. GDP growth slowed from 6.3 percent year-on-year (yoy) in the first half of 2018 to 5.5 percent in thesame period in 2019, below government’s growth target of 6-7 percent for 2019. The slowdown was primarily driven by a contraction in nominal public investment due to the delayed passage of the 2019 national government budget and the spending ban on new projects before the May election. Public infrastructure spending shrunk by 15.7 percent yoy in nominal terms, from 5.4 percent of GDP in the first half of 2018 to 4.3 percent of GDP in the same period in 2019. In addition, private investment activities also slowed due to uncertainties around the government’s ongoing tax reform program and the external environment. In this context, private consumption, which regained momentum thanks to declining inflation and improving labor market conditions, was the main driver of growth.

Details

  • Document Date

    2019/10/01

  • Document Type

    Working Paper

  • Report Number

    142521

  • Volume No

    1

  • Total Volume(s)

    1

  • Country

    Philippines,

  • Region

    East Asia and Pacific,

  • Disclosure Date

    2019/10/10

  • Disclosure Status

    Disclosed

  • Doc Name

    Philippines Economic Update : Resuming Public Investment, Fast Tracking Implementation

  • Keywords

    state-owned enterprise; employment in the services sector; barriers to trade; labor force participation rate; natural barrier to entry; value-added tax; government final consumption expenditure; social and economic development; International Trade and Investment; gross fixed capital; Cost of Doing Business; local government support; limited regulatory capacity; percent inflation rate; incidence of poverty decline; labor market condition; investment growth; global trade; barriers to entrepreneurship; public procurement tender; expansionary fiscal policy; trade tensions; recent development; balance of payment; foreign direct investment; machinery and equipment; lack of competition; corporate income tax; national government budget; tax reform program; major trading partners; professional service; international crude oil; national government agency; regional value chain; competition assessment; markets where competition; total debt stock; market rule; public investment spending; prices for goods; total variable costs; civil engineering; flood control system; agricultural wage employment; emerging market bond; engine of growth; million people; private consumption growth; price of rice; long-term fiscal sustainability; compulsory social security; monetary policy; net factor income; radio and television; mobile phone service; provision of service; current account balance; electric power industry; product market reform; crude oil price; enforcement of regulation; human capital development; excise tax rates; financial sector reform; monetary policy instrument; capital goods import; individual question; business process outsourcing; oil-producing country; difficult external environment; Capital Adequacy Ratio; public expenditure growth; consumer confidence index; business confidence index; operation of infrastructure; demand for credit; inflow of capital; fiscal deficit target; price of crude; global capital flow; lower income household; lack of regulation; competition policy reforms; return on asset; road freight service; local loop unbundling; share of wage; economies of scale; national payment system; air transport industry; number of visitors; youth unemployment rate; european central bank; corporate tax reform; quality of public; foreign exchange rate; low poverty rate; global oil production; corporate tax regime; high unemployment rate; economic growth prospects; road freight transport; global economic outlook; cost of import; value crop; Universal Health Care; competitive business environment; withholding tax rate; health and nutrition; infrastructure investment program; public investment program; global production chain; preferential market access; product market regulation; chamber of commerce; liquified petroleum gas; human capital needs; rate of inflation; removing price control; agriculture and service; access to financing; unpaid family worker; real estate valuation; growth in trade; national road network; student financial assistance; current account deficit; external financial conditions; foreign equity investment; labor market entrant; degree of competition; subject to regulation; student loan program; increase in capital; combination of factor; reinvestment of earnings; negative interest rate; reduction in poverty; poor growth performance; nominal exchange rate; consumer goods imports; pest control service; conditions of competition; electricity transmission grid; impact on poverty; information and communication; official exchange rate; growth in agriculture; competitiveness enhancement; financial sector specialist; bureaucratic red tape; Social Protection; Public Spending; export growth; infrastructure spending; external demand; foster competition; advanced economy; global growth; trade war; private investment; vested interests; Job Creation; foreign reserve; trade dispute; household income; global demand; domestic demand; policy uncertainty; administrative burden; inclusive growth; regulatory restriction; market entry

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Citation

Philippines Economic Update : Resuming Public Investment, Fast Tracking Implementation (English). Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/224501570715185892/Philippines-Economic-Update-Resuming-Public-Investment-Fast-Tracking-Implementation