Connect with us

Hi, what are you looking for?

Economy

Fitch Ratings warns of low-base distortions in 2021 growth data

THE Asia-Pacific economic recovery in 2021 could be “misleading,” with apparent rebounds that are actually the result of the low base formed by 2020, while fresh outbreaks could also deal setbacks to pandemic containment efforts, Fitch Ratings said in a report Monday.

“In many cases, GDP (gross domestic product) will not return to pre-pandemic levels until the end of 2021 or 2022,” it said.

Fitch Ratings expects the Philippine economy to contract by 8% this year before rising 9% in 2021. Government economic managers expect a contraction of between 8.5% and 9.5% this year and forecast growth of between 6.5% and 7.5% in the coming year.

Fitch Ratings said virus caseloads in the Philippines, India, and Indonesia have only recently levelled off, with China, Taiwan, South Korea, Japan, Vietnam and Thailand having contained their outbreaks earlier.

“Even the successful countries have seen new outbreaks, necessitating re-imposition of restrictions as they await vaccines later in 2021,” it said.

Fitch Ratings added that economies that rely on remittances could undergo a period of adjustment as the migrant workforce is gradually summoned back to the host countries, though it noted that the Philippines, Bangladesh, and Sri Lanka have held up better than expected.

“This may reflect temporary factors related to the return of migrant workers and the channels through which they remit funds,” Fitch Ratings said.

Remittance inflows to the Philippines declined 1.4% year on year to $21.886 billion in the nine months to September, less severe than the decline of 2% projected by the central bank over the full year.

Separately, S&P Global Ratings Asia-Pacific Chief Economist Shaun Roache said in a webinar Monday that Asian economies will experience “less acute” downside risk from US-China tensions and cited the possible impact of “stimulus withdrawal” next year.

“Supply-side, Asia is leading the recovery, but  Asia leading the demand-side is not true,” Mr. Roache said, noting that consumption is still far behind the pre-pandemic levels.

S&P expects the Philippine GDP to contract by 9.5% this year before growing 9.6% and 7.6% in 2021 and 2022, respectively. — Luz Wendy T. Noble

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

By Diego Gabriel C. Robles THE Philippine economy expanded by 7.4% in the second quarter — slower than expected — as rising inflation weighed...

Economy

By Abigail Marie P. Yraola, Researcher THE Philippines’ merchandise trade deficit hit another record in June as imports continued to outpace exports despite a...

Economy

THE National Government’s (NG) outstanding debt as a share of the gross domestic product (GDP) eased to 62.1% at the end of June. Data...

Economy

By Keisha B. Ta-asan SOURED LOANS held by Philippine banks fell for a fourth straight month in June, bringing the nonperforming loan (NPL) ratio...

Economy

Smart says third telco player’s PCC complaint meant to avoid liability By Arjay L. Balinbin, Senior Reporter GLOBE Telecom, Inc. on Tuesday said it...

Economy

DMCI Holdings, Inc. reported on Tuesday that its second-quarter consolidated net income went up by 73% to P9.03 billion from P5.23 billion, driven by...

You May Also Like

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Economy

Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...

Investing

Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Investing

Instagram still holds the top spot for social media in terms of building brand reputation and expanding business potential. Every day, more and more...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.