ELECTIONS 2022: Economic growth dependent on full reopening of economy

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Former Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa Guinigundo warns of several factors that may affect Philippines' economic growth (Photo: Yahoo Philippines)
Former Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa Guinigundo warns of several factors that may affect Philippines' economic growth (Photo: Yahoo Philippines)

Although the Department of Budget and Management’s Development Budget Coordinating Committee (DBCC) projects a seven to nine percent economic growth in 2022 and six to seven percent in 2023 and 2024, a monetary expert warned that these projections will depend on several factors.

Former Bangko Sentral ng Pilipinas Deputy Governor Diwa Guinigundo, in an interview with Yahoo Philippines, said that the uncertainty of the pandemic, the rising prices of oil due to the Russia-Ukraine conflict, and possible disruptions in the value chain may affect the growth projections.

“It is important to clarify that this forecast is premised on a full reopening of the Philippine economy,” Guinigundo said. “[S]hould any of these three starts to become a problem or pose a problem to achieving those targets, then the DBCC will have to withdraw its forecasts.”

The World Bank, at a briefing on April 5, has trimmed down the Philippines’ economic growth projections due to the impact of the war in Eastern Europe. Its projection for 2022 was downgraded to a conservative estimate of 5.8 percent, according to World Bank East Asia and Pacific Chief Economist Aaditya Mattoo.

Meanwhile, from the year 2023 to 2024, the World Bank projects that the country’s Gross Domestic Product (GDP) will grow by an average of 5.6 percent, way below the DBCC’s forecasts.

“Growth will draw strength from the domestic environment with declining COVID-19 cases, looser restrictions, and wider opening,” the World Bank’s report said.

That is why, according to Guinigundo, it is important for the government to continue its massive vaccination program to neutralize the threat of the pandemic. At present, the country’s vaccination rate slowed down in the last three months despite adequate supply.

“These are the issues that have to be addressed and have to be resolved not only in the next six years but also beyond,” Guinigundo added. “That’s what a good government should do.”

Marvin Joseph Ang is a news and creative writer who follows developments in politics, democracy, and popular culture. He advocates for a free press and national democracy. The views expressed are his own.

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