CONSUMER spending has put Philippine economic growth, which was upgraded last week by the International Monetary Fund (IMF), on a separate track from most other countries, East West Banking Corp. (EastWest Bank) said.
“I think consumption will be a driver for GDP (gross domestic product) growth. If you saw recently, the IMF just upgraded the Philippines, while the rest of the world is on a different trajectory,” EastWest Bank Chief Executive Officer Jerry G. Ngo told reporters on Thursday.
The IMF last week raised its growth outlook for the Philippines to 6.2% from the 6% forecast it issued in April, with domestic demand expected to remain robust.
IMF Representative to the Philippines Ragnar Gudmundsson said the Philippine growth forecast this year was revised to reflect the strong first-quarter economic reading.
The economy expanded 6.4% in the first quarter, beating expectations, though it reflects a slowdown from the 8% growth posted a year earlier.
The IMF forecast is within the government’s 6-7% target for this year. In 2022, GDP grew 7.6%.
Mr. Ngo added that the young workforce will also contribute to growth in the medium to long term.
However, this will depend on whether enough jobs are created to absorb the workers available.
“We need to make sure that there’s employment creation. I’m concerned about technology replacing humans. We’re using it already to make people productive,” Mr. Ngo said.
He added that overseas macroeconomic developments outside our control could also dampen growth.
“I do think there will be some headwinds from the US. China is already experiencing a slowdown. (There’s) some fragility in the US with their employment sector which was very strong before. In China, the housing and property sector is starting to be affected as well,” he said.
On Thursday, the bank launched its e-wallet app, EastWest Pay, and its new Platinum Visa credit card.
Mr. Ngo said the e-wallet app has been in testing for four months.
The mobile app, which is only available on Samsung phones, features security functions such as tokenization and biometrics for transaction approval. — Aaron Michael C. Sy