By Luz Wendy T. Noble, Reporter
THE INTERNATIONAL Monetary Fund (IMF) kept its growth forecast of 6.3% for the Philippines this year, saying the impact of the Omicron variant would likely affect only the first three months.
“Even though the rapid spread of the Omicron variant and new quarantine measures in the first quarter of 2022 are expected to slow the recovery, strong growth is nevertheless projected for the remainder of 2022, as vaccination proceeds further, policy measures remain appropriately supportive, and private sector confidence improves,” IMF Representative to the Philippines Ragnar Gudmundsson said in an e-mail.
The IMF’s forecast is lower than the 7-9% growth target set by the government this year.
Metro Manila and other parts of the country are under Alert Level 3 amid an Omicron-driven surge in coronavirus infections. Latest data from the Department of Health showed active cases rose by 15,789 on Wednesday to 230,410.
The Health department said 57.844 million Filipinos had been fully vaccinated as of Jan. 25. The government targets to fully inoculate 77 million by the end of March.
Mr. Gudmundsson said it is important for the Philippine government to address rising poverty and inequality brought by the pandemic.
“Considering the negative impact of COVID-19 on poverty and inequality, increased spending on social protection, particularly health and education, further strengthening public service delivery, and meeting commitments on climate change will be important to foster more inclusive and greener growth,” he said.
“Continued investments for vital infrastructure under the ‘Build, Build, Build’ program should contribute to economic recovery and create new job opportunities,” he added.
The IMF official said the pandemic and the likelihood of tightening of global financial conditions highlight the need for the government to respond quickly to adverse external shocks.
He said the country should also focus on “climate change adaptation efforts to mitigate the impact of more frequent extreme weather-related events such as Typhoon Rai (Odette).”
By 2023, Philippine economic growth is projected to “pick up close to 7%,” Mr. Gudmunddson said. This expansion is expected to stabilize at about 6.5% yearly over the medium term, he added.