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IMF revises Philippines' FY24 GDP growth projection to 6%

12 Jun '24

2 min read

IMF revises Philippines' FY24 GDP growth projection to 6%

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The IMF revised its FY24 GDP growth forecast for the Philippines to 6 per cent due to weaker household consumption and investment.
Initially set at 6 per cent, the forecast was raised to 6.2 per cent in April after strong Q4 2023 performance.
For FY25, the IMF projects 6.2 per cent growth, driven by increased demand, investments, and exports.

The International Monetary Fund (IMF) has adjusted its forecast for the Philippines' GDP growth for fiscal 2024 (FY24) to 6 per cent, citing a slowdown in household consumption and investment. Initially, the IMF projected a 6 per cent growth rate at the beginning of the year. However, in April, this forecast was revised upward to 6.2 per cent following unexpectedly strong economic performance in the final quarter of 2023.

Looking ahead, the IMF anticipates a GDP growth rate of 6.2 per cent for FY25, driven by increased consumer demand, higher investment levels, and improved export performance. This optimistic projection is based on several assumptions, including a rapid decline in price inflation. The IMF expects these policy changes to be enacted before the end of FY24.

“The Philippine economy continues to perform well despite external challenges and policy tightening. GDP growth moderated in FY23 to 5.5 per cent, due to the confluence of global shocks, inflationary pressures, and slowing consumption. Growth is expected to rebound to 6 per cent in 2024 and 6.2 per cent in 2025, on the back of stronger consumption demand, higher public and private investment, and a recovery in exports. Downside risks to the outlook stem from geoeconomic fragmentation, high interest rates, and climate-related shocks, while efforts to attract foreign direct investment, promote business-friendly reforms, and enhance competitiveness could raise the economy’s long-term growth potential, said Elif Arbatli Saxegaard, deputy division chief at the IMF.

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