REVENGE spending or pent-up demand is one of the strongest growth drivers of the Philippine economy this year, but this rise in consumption would not be enough for GDP growth to exceed 6 percent this year.
The local think tank said other growth drivers include infrastructure spending, as the budget of the Department of Public Works and Highways rose by 12.1 percent in 2023. Projects like the Metro Manila subway and North-South Commuter line are expected to “gain greater traction” this year, it added. Data from the Philippine Statistics Authority showed Household Final Consumption Expenditure grew 8.3 percent while Government Final Consumption Expenditure slowed to 5 percent in 2022.
This means every Filipino shelled out an additional P13.26 to buy goods worth P100 in 2022. Products worth P100 in 2018, the base year used to compute the Consumer Price Index , cost P113.26 last year. Koh also said consumer sentiment is weakening and investment activities are expected to plateau in 2023. The tight monetary policy will also likely weigh down the country’s economic prospects this year.Meanwhile, in a separate briefing on Tuesday, the International Monetary Fund has also downgraded its growth forecast for the ASEAN-5 or Indonesia, Malaysia, Philippines, Singapore, and Thailand.