September 26, 2022
  • September 26, 2022

PH 2022 growth forecasts reduced to 7.1%

By on January 9, 2022 0

A further economic reopening during the Christmas holidays last year likely boosted growth in 2021, but the surge in COVID-19 infections earlier this year is expected to temper the expansion of gross domestic product (GDP), according to updated forecasts from investment banking giant Goldman Sachs.

In a Jan. 8 report, Goldman Sachs Economics Research noted that “the Omicron variant of COVID-19 has started to spread across most of the Asia-Pacific economies.”

“Given the much higher infectivity of this strain, an ‘Omicron wave’ is likely across much of the region in the coming weeks,” Goldman Sachs warned.

“Although Omicron appears to cause less severe disease than previous variants, much higher infection rates could still lead to a significant increase in hospitalizations in the weeks to come. This in turn could lead to at least a modest increase in restrictions in the region, as we are starting to see in India, Hong Kong and the Philippines, for example, ”Goldman Sachs said.

Surge in cases

As COVID-19 cases increased, Metro Manila, four surrounding provinces and other regions, which made up about half of the economy, had been subject to more stringent Alert Level 3 restrictions until ‘to January 15. The economics team announced on Friday the move to a – a notch higher alert level will cost 3 billion pesos in lost production per week.

Goldman Sachs noted that since community transmission of Omicron was likely already present in the Philippines given the current rise in infections, local leaders in Metro Manila have imposed lockdowns on those who were not. still not vaccinated against COVID-19.

In a separate Jan. 7 report, Goldman Sachs said that “Indonesia and the Philippines are lagging behind in terms of regional immunization progress” with only 61% and 53%, respectively, of their populations inoculated with at least a dose of the COVID-19 vaccine since last week.

As such, Goldman Sachs reduced its 2022 GDP growth projection for the Philippines to 7.1%, from 7.3% previously. His forecast remained within the government’s 7-9% growth target.

Alongside Vietnam’s projected 9.5% growth rate and India’s 9% growth rate this year, Goldman Sachs expects the Philippines to surpass Malaysia’s 6.5%, 5.1% of Indonesia, 5% from Singapore, 3.4% from Thailand, 3.2% from Taiwan and 3.1% from South Korea. , and Hong Kong by 2.6 percent.

Slower increase

Goldman Sachs predicts first-quarter GDP to grow 6.6% year-on-year, down from 6.9% previously.

Quarter-over-quarter, Goldman Sachs estimated first quarter GDP to be 0.7% higher than economic output in the fourth quarter of 2021, a slower increase from the previous expectation of 1 , 4% growth.

Goldman Sachs was more optimistic about second-quarter growth, however, slightly raising its forecast to 9.5% year-on-year from 9.4% previously.

For Goldman Sachs, 2021 likely ended with 5.1% full-year GDP growth, faster expansion than its previous forecast of 4.9%.

He predicted that the fourth quarter of last year would have grown 5.6% year-on-year, more optimistic than the previous projection of 5.1%.

This is due to expectations that production in the fourth quarter of 2021 was up 1.7% from the third quarter, also an improvement from the previous forecast of 1.2% quarter-on-quarter growth.

Goldman Sachs said it increased its growth estimates for the fourth quarter of 2021 due to “stronger tracking and / or mobility data in Indonesia, Malaysia and the Philippines.” INQ

Read more

Don’t miss the latest news and information.

Subscribe to INQUIRER PLUS to access The Philippine Daily Inquirer and over 70 other titles, share up to 5 gadgets, listen to the news, download from 4 a.m. and share articles on social media. Call 896 6000.

For comments, complaints or inquiries, contact us.