Three forecasters have accurately predicted the 6.4 percent gross domestic product (GDP) expansion for the October-December 2019 period, according to an analysis by the Department of Finance (DOF) of the quarterly growth projections by 20 private sector experts.
“Economic growth accelerated to 6.4 percent in the 4th quarter of 2019, which remains among the highest in the region, and should be sustained into the next quarters based on strong fundamentals,” said Finance Undersecretary and Chief Economist Gil Beltran.
Beltran reported that “as growth picked up, three analysts were able to accurately forecast this development beforehand. They are Alex Holmes of Capital Economics, Emilio Neri Jr. of Bank of Philippine Islands (BPI), and Ruben Carlo Asuncion of Union Bank of the Philippines (UBP).”
“These three analysts got the Q4 2019 GDP growth exactly right, so it follows that their full-year estimates will also be correct because GDP growth figures from the first three quarters were already reported by the PSA (Philippine Statistics Authority),” Beltran.
In addition, he said that three more analysts have made forecasts that were close enough to the official estimate to make their 2019 full-year estimates correct, at 5.9 percent.
“These are Jefferson Arapoc of the University of the Philippines (UP), Romeo Bernardo of GlobalSource Partners, and Alvin Ang of the Ateneo Center for Economic Research and Development (ACERD),” Beltran added.
The DOF analyzed the growth forecasts of 20 analysts from institutions that regularly release their estimates via Manila’s media.
The latest forecasts came as the country remained among the fastest-growing major economies in Asia.
Based on the latest GDP growth figure for the 3rd quarter of 2019, which the PSA revised downward from 6.2 to 6.0 percent, the following analysts made accurate forecasts for that period: Neri, Jonathan Ravelas of BDO Unibank Inc., and Patrick Ella of Sun Life.
“The DOF will continue to regularly monitor GDP forecasts to help promote accountability and incentivize the use of better forecasting models,” Beltran reiterated.
Aside from the six analysts mentioned above, the others include Pramila Krshnan of Oxford Economics, Noelan Arbis of Hongkong and Shanghai Banking Corp. (HSBC), Eugenia Victorino of Skandinaviska Enskilda Banken (SEB), Katrina Ell of Moody’s Analytics, Rajiv Biswas of IHS Markit, Euben Paracuelles of Nomura Securities, Emmanuel Lopez of Colegio de San Juan de Letran, Jiaxin Lu of Continuum Economics, Nicholas Mapa of ING Bank Manila, Robert Dan Roces of Security Bank, Michael Ricafort of Rizal Commercial Banking Corp. (RCBC) and Mitzie Irene Conchada of De La Salle University (DLSU).
“The pickup in growth in the fourth quarter of 2019 resulting in part from the government’s catch-up spending following anemic expansion in the year’s first semester will gain speed in 2020, with the domestic economy firing on all cylinders as a result of even more vigorous investments in infrastructure and human capital development for the entire year ahead,” Dominguez said.
With the timely approval of the 2020 General Appropriations Act (GAA) and the extended validity of the 2019 GAA till end-2020, Dominguez expects “a double-barreled boost enough to sustain—and even crank up—the level of catch-up spending that the economic team, upon President Duterte’s directive, carried out in the remaining half of last year to reverse anemic growth in the first two quarters brought about by the delay in the congressional approval of the national budget.”
