PHILIPPINE DAILY INQUIRER - November 5, 2009

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World Bank sees brighter outlook for RP

MANILA, Philippines - Acknowledging that the Philippines proved to be more resilient in the face of a global financial crisis than earlier anticipated, the World Bank retracted its forecast of a 0.5-percent contraction for the economy this year and set its new projection to a growth of 1.4 percent.

The World Bank likewise revised its outlook on the Philippines for 2010, from a growth of only 2.4 percent to 3.1 percent.

Eric Le Borgne, senior economist for World Bank Manila office, said remittances and the government’s stimulus programs spelled the difference between its old and new assumptions.

It was earlier believed that remittances to developing countries like the Philippines would sharply decline this year because of layoffs in recession-stricken countries in the West.

However, Le Borgne said, remittances to the Philippines remained strong because of the deployment of new workers to alternative labor markets, including the Middle East. Newly deployed Filipinos outnumbered those who lost their jobs.

Earlier, the World Bank said remittances sent to the Philippines would fall by 4 percent from the $16.4 billion recorded last year. Now, it sees a 4-percent increase in the money sent by Filipinos based abroad.

The revised economic growth forecast of the World Bank came after the announcement that Philippines grew by 1.5 percent in the first half.

According to the Arroyo administration, this figure kept the economy on the growth track, expecting it to rise between 0.8 and 1.8 percent for the full year.

“The Philippines avoided a recession, thanks to timely fiscal and monetary stimuli combined with larger than projected inflow of remittances,” the developmental lender said in its latest Philippine Quarterly Report released yesterday.