Philippine economy to grow faster, but below target

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The Philippine economy is expected to expand at a faster pace this year from last year, but growth is projected to fall short of the government's target, according to a report from the United Nations.

The World Economic Situation and Prospects 2024 report released by the UN showed a gross domestic product (GDP) growth forecast of 5.8 percent for the Philippines this year, higher than the estimated 5.4 percent growth last year.

Still, the UN's economic growth forecasts for the Philippines this year and in 2023 are below the targets set by the government.

In particular, the government is aiming to achieve 6.5 to 7.5 percent growth this year, a revision of the previous goal of 6.5 to eight percent.

Meanwhile, the growth goal for 2023 was set at six to seven percent.

The economy posted 5.9 percent growth in the third quarter, faster than the 4.3 percent expansion in the second quarter.

This brought growth in the January to September period to 5.5 percent.

National Economic and Development Authority Secretary Arsenio Balisacan earlier said growth in the fourth quarter of last year should at least be 7.2 percent to meet the lower end of the government's target for 2023.

For 2025, the UN sees the Philippine economy growing by six percent.

This forecast is also lower than the government's 6.5 to eight percent growth target for that year.

For East Asia, the UN is projecting GDP growth to moderate to 4.6 percent this year from an estimated 4.9 percent in 2023.

'Continued weakness in external demand, economic uncertainties in China, and tightened global financial conditions weigh on the region's growth in the short term, while slowing productivity growth, geopolitical risks, and climate change challenge economic prospects in the medium term,' the UN said.

The UN report also showed inflation in the Philippines is expected to slow to 3.7 percent in 2024 and to ease further to 3.5 percent in 2025.