Asia Regional Integration Center

GDP growth edged up to 5.1% in 2017 from 5.0% in 2016, driven by renewed acceleration in export growth, stronger investment, and private consumption encouraged by a robust job market. Exports of goods and services, having contracted for 2 consecutive years in 2015 and 2016, rose by 9.1% in 2017 providing fresh impetus to the economy. Supported by higher public infrastructure spending and stronger private investment, fixed capital formation accelerated by 6.2%. Robust growth in private consumption at 5.0%, as in 2016, reflected solid job growth and low inflation.

Growth is forecast higher, at 5.3% both in 2018 and 2019, with continued strength in investment and private consumption more than offsetting expected moderation in export growth. The government’s commitment to boosting infrastructure and improving the business environment should support stronger investment. Positive business sentiment encouraged by structural reform may be partly offset by some private investors adopting a wait-and-see stance as regional elections in 2018 and a national election in 2019 approaches.