Asia Regional Integration Center

Robust domestic demand, upheld by higher export growth, helped GDP grow by 6.7% in 2017. This was marginally slower than 6.9% in 2016, partly because of a high base effect following election spending in 2016. Growth in exports of goods and services was recorded at 19.2% in 2017 thanks to the rebound in global electronics trade. Household consumption grew by 5.8% supported by higher employment and remittances from overseas Filipinos. Government consumption moderated to 7.3% in 2017, despite accelerated growth of government expenditure at 11.2 in the second half of the year. Growth of domestic investment decelerated to 9.0% in 2017 from 23.7% in 2016 on account of sustained fixed investment in industrial machinery, transport equipment, and public construction.

GDP growth is forecast to strengthen to 6.8% in 2018 and 6.9% in 2019, underpinned by strengthening domestic demand. Investment will be supported by large public infrastructure projects such as national and provincial roads, railways, airports, and the Philippines’ first mass transit subway. Export growth will likely moderate from last year’s rebound. Low unemployment and steady remittances will continue to support household consumption.