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BusinessWorld

Philippine growth seen picking up in second half — World Bank

PHILIPPINE ECONOMIC growth could pick up in the second half as public infrastructure spending accelerates and inflation eases, bringing the government’s full-year growth target within closer reach, a World Bank economist said.

Context & Analysis

For Philippine companies, the practical question is whether improved economic momentum will reach suppliers, consumers, and provincial markets quickly enough to change business planning. A stronger domestic cycle would likely be uneven at first. Firms in construction inputs, equipment rental, logistics, steel, cement, electrical supplies, and local fabrication may feel demand earlier than consumer-facing businesses that depend on household confidence. The distinction matters because project-related activity can lift employment and supplier turnover without immediately translating into broad-based retail strength.

Consumers should care about the same mix. A calmer cost environment can give household budgets more breathing room, especially for food, fuel, and transport. That may support spending on services, electronics, and travel, but only if wages keep pace with living costs. For lenders and investors, a steadier price backdrop could reduce pressure on monetary authorities to maintain tight policy, although the central bank will still weigh global shocks, peso movements, and financial stability. A stronger domestic cycle could also lift earnings expectations for groups exposed to construction, real estate development, utilities, and industrial services.

The key test is execution. Large public projects can slow if they face land acquisition, permitting, environmental review, or local government bottlenecks. Companies should watch whether tenders move from planning to implementation, whether subcontractors are mobilized, and whether import supply chains for specialized equipment remain smooth. For policymakers, the next few months will reveal whether gains are broad enough to reach beyond Metro Manila and large provincial hubs. A convincing improvement would need stronger provincial demand, better transport links, and private investment following public works rather than waiting for them.

Analysis by IJE Software — original commentary on the story above.

This is an excerpt. Read the full article at the original source:

Source: bworldonline.com

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