MANILA -- The Philippine economy is expected to accelerate at least 7 percent in the second quarter of the year spurred on by the surge in infrastructure spending, manufacturing output and tax revenues, analysts at First Metro Investment Corp. (FMIC) and University of Asia and the Pacific (UA&P) said Wednesday.
“The six consecutive months of above-20 percent growth in infrastructure spending and major PPP (public-private partnership) projects gaining momentum show that the National Government’s Build-Build-Build program is gaining traction,” they said in the latest issue of The Market Call Capital Markets Research.
The report noted the construction sector will thus likely lead investment spending this quarter.
It said the surge in infrastructure spending, together with strength in manufacturing, should overcome any weakness in exports in April to June quarter and beyond.
FMIC and UA&P expected an export turnaround to positive territory before the end of the second quarter with the significantly faster growth expected in the United States beginning this quarter, as well as the expected recoveries of the European Union, Japan and China.
The report further said that remittances from Overseas Filipino Workers (OFW) should take a positive turn this month, as the issue on the unilateral ban on deployments to Kuwait has been resolved.
The increase in inflows of foreign direct investments (FDI) is also expected to boost gross domestic product (GDP) growth starting second quarter, it added.
The Philippine economy grew by 6.8 percent in the first quarter. (PNA)
