Economic and business update for the Philippines - August 2022

The Philippines posted growth of 8.2% in its Gross Domestic Product (GDP) during the first quarter of 2022 and expanded less than expected in the second quarter at 7.4%, but still on track with the official 2022 growth target.

Due to rising domestic investment and consumption as pandemic restrictions eased, the Philippine economy is poised to grow by 6.5% - 7.5% in 2022 and could further rise by 8% in 2023, forecasted to be the highest economic growth rate among ASEAN+3 countries.

Key changes to the Foreign Investment Act and Public Service Amendment Act have now been signed into law. The amendments are expected to promote foreign investment by reducing foreign ownership restrictions while also removing restrictions on foreign equity in most public service companies.

Further engagements and strengthening of bilateral trade between New Zealand and the Philippines are expected to stem from membership of the Indo-Pacific Economic Framework for Prosperity (IPEF). Firm statements are being made regarding RCEP, but it remains unratified. Negotiations to upgrade the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA) are ongoing and are expected to further reduce trade barriers and boost two-way trade.

To date, indications are that the new administration of President Marcos Jr will continue in the same vein as the previous administration with a more robust approach and a relatively orthodox and business-friendly ideology.

Reference: https://www.mfat.govt.nz/en/trade/mfat-market-reports/market-reports-asia/economic-and-business-update-for-the-philippines-august-2022/