NextGen Day

This year, domestic growth is anticipated to be fueled by the Philippine economy’s ongoing normalization and the effects of reduced individual income taxes, reform initiatives, and demographic dividends, among other factors.

According to research released on Thursday by Michael Ricafort, chief economist at Rizal Commercial Banking Corporation (RCBC), the economy continues to have “bright spots” including exports, exports, a nearly record-low jobless rate, and development in the manufacturing sector.

Due to the effects of high inflation, the nation’s gross domestic product (GDP) decreased in the final three months of 2022 from 7.6 percent to 7.2 percent.

The average economic growth for the entire year was 7.6 percent, beating the government’s projection of 6.5 to 7.5 percent.

With the stabilizing of the GDP base/denominator (and no further lockdowns in 2022), he predicted that the Philippines’ projected GDP growth for 2023 “may normalize to about 6-7 percent in 2023 and beyond.”

Given the impact of outside factors, such as the anticipated recession in the US economy, the government’s 2023 GDP projection has been reduced from 6.5 to 8 percent to between 6 and 7 percent.

Ricafort listed various variables anticipated to fuel economic growth this year, including the demographic dividend that comes from having a sizable population that is youthful and working-age.

Gains from the demographic dividend, according to him, contribute to domestic growth because they “promote continuing resilience of consumer spending,” which makes up at least 75% of the economy.

These gains, according to Ricafort, can be made “so long as the population, particularly those in the labor force, becomes more productive; as well as (a) good foundation on education, nutrition, and health care for the youth to prepare the next generation to become more economically productive in the future.”

As a result of the Tax Reform for Acceleration and Inclusion (TRAIN) law, he claimed that this year’s further individual income tax cuts “may lead to greater consumer spending, which accounts for at least 75% of the GDP.”

This could “duce to faster economic/GDP growth; to also help ease the negative consequences of increasing prices/inflation recently,” according to Ricafort.

Meanwhile, Ricafort stated that the major policy rates of the Bangko Sentral ng Pilipinas (BSP) are “essentially projected to match any future Fed (Federal Reserve) rate hikes,” supporting additional increases in these rates.

As a matter of policy, stabilizing the peso exchange rate and overall inflation might be aided by any increase in the BSP’s key rates, he continued.

Save/Share this story with QR CODE

---

Disclaimer

This article is for informational purposes only and does not constitute endorsement of any specific technologies or methodologies and financial advice or endorsement of any specific products or services.

Need to get in touch?

Feel free to Contact NextGenDay.com for comments, suggestions, reviews, or anything else.

---

We appreciate your reading. Simple Ways To Say Thanks & Support Us:
1.) GIVE A TIP. Send a small donation thru Paypal
Your DONATION will be used to fund and maintain NEXTGENDAY.com
Subscribers in the Philippines can make donations to mobile number 0917 906 3081, thru GCash.
3.) BUY or SIGN UP to our AFFILIATE PARTNERS.
4.) Give this news article a THUMBS UP, and Leave a Comment (at Least Five Words).

---

AFFILIATE PARTNERS

World Class Nutritional Supplements - Buy Highest Quality Products, Purest Most Healthy Ingredients, Direct to your Door! Up to 90% OFF.
Join LiveGood Today - A company created to satisfy the world's most demanding leaders and entrepreneurs, with the best compensation plan today.

---