Since 2012, the Philippines' economic growth has been consistently high, driven in particular by private consumption, which accounts for about 70% of the economy.
Although a slowdown in economic expansion is expected in 2019 and 2020 due to rising interest rates, decreased investor confidence, and the negative contribution of exports, the annual growth rate will remain above 5,5%, supported mainly by household consumption and public spending.
Until now, enormous infrastructure deficiencies have prevented greater investment from the manufacturing industry. The government is promoting structural projects and spending in this area is expected to increase from 5% of GDP in 2017 to more than 7% in 2022, directed towards the construction of rail and road networks, ports, airports and energy production.
With the improved tax base resulting from the tax reform, fiscal deficits and public finances are expected to remain at an acceptable level, supporting the continuity of public investment. The external macroeconomic environment is good, with manageable external debt representing 19% of GDP and ample liquidity.
