Economic Outlook 2023

   

For example: with 8.7 percent inflation in January 2023, the high global inflation rates worldwide imported to the Philippines led to a 14-year high of the country; uncertainties on the horizon due to the wars in Ukraine, growing tensions between Beijing and Taipei as well as its own conflict with China in the West-Philippine Sea dampen the generally good socio-economic perspectives of the country and the region (a little). 

   

According to the International Monetary Fund (IMF), the Philippine economy grew in 2021 by a respectable 5.7 percent, after the pandemic downturn of -9.5 percent in 2020. Growth in 2022 accelerated back to pre-pandemic levels at 7.8 percent - one of the highest growth rates in the region.

   

For 2023, the Asian Development Bank trimmed its growth outlook for the Philippines to 6.3 percent. The IMF is a little more pessimistic and reduced its initial forecast from 6.3 percent to 5 percent. The unpredictability of current trouble spots worries analysts and results in cautious forecasts, not only for the Philippines. 

   

Nonetheless, in comparison to the global economic environment, the growth estimates remain still striking, which is primarily due to the socio-economic sweet-spot the Philippines are in, amongst others, due to its young, educated, English-speaking workforce, a large domestic market and still partially untapped rich natural resources. 

   

The infamous Filipino resilience and the countries´ economic management of the pandemic's aftermath has shown that the Philippine economy remains fundamentally sound thanks to sustained reforms and disciplined mac-roeconomic policies that contained macro-financial vulnerabilities and mitigated the effects of the pandemic. The country seems overall capable of a quick return to its old and unprecedented stable and high pre-pandemic growth levels and beyond in the years to come. Regardless of what might be lying ahead, particularly in the areas related to infrastructure projects, the Business Process Outsourcing sector, Renewable Energy and the recruitment of qualified personnel, the Philippines can draw strength from their steady inflow of new or continuous investment.