LOWER EXPORTS, as well as tighter fiscal and monetary policies, could slow the growth of the Philippines along with other economies in the region, Standard & Poor’s yesterday said in a report.
The ASEAN-5 comprising the Philippines, Indonesia, Malaysia, Thailand and Vietnam is “losing steam,” the debt watcher said, especially in the face of possible recessions in the United States and Europe.
“Although growth prospects for the ASEAN-5 are better than those for the developed economies, several factors that helped lift these countries out of the slowdown in 2009 are gradually losing steam,” the report states.
With ASEAN-5 countries heavily dependent on trading partners, grim growth prospects in the US, Europe and even China could bring down their economies as exports falter.
“We believe slowing growth is inevitable for the ASEAN-5 during 2011 and 2012, and the region could be in for a hard landing if the advanced economies enter another recession,” S&P said.
This may be worse for the Philippines, whose dependence on the three economic giants is among the highest in the region. According to the study, the US accounts for 16.5% of the country’s total exports while Europe contributes 17.4% and China, 14.5%. — D. C. J. Jiao, Businessworld
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