Hitting GDP goal may be 'challenging'

ACHIEVING ABOVE-6% gross domestic product (GDP) growth for the rest of the year to meet the government's target may be “challenging” with the global trade picture still uncertain due to the Trump administration’s evolving tariff policies, analysts said.

- By Aubrey Rose A. Inosante Reporter

“It will certainly be challenging to achieve a 6.2% growth rate for the rest of the year, but it is still possible,” Ateneo School of Government Dean and Economics Professor Philip Arnold P. Tuaño said in an e-mail over the weekend.

“Some of the downside risks for the Philippine economy remain the continued high levels of US tariffs, global political and security uncertainties especially in Europe and the Middle East which affect global demand for goods, and climate related shocks.”

“US President Donald J. Trump's reciprocal tariffs, trade wars, and other protectionist policies could still slow down global trade, investments, employment, and overall world economic growth that could slow down, indirectly, Philippine GDP growth,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message, but likewise added that the growth goal remains achievable.

The Philippine economy expanded by 5.4% in the first quarter, slightly faster than the 5.3% growth in the prior three-month period but slower than the 5.9% pace in the same quarter last year, the government reported last week.

This was well below the government’s 6-8% growth target band for the year.

The weak growth came as gross capital formation growth was dampened by businesses’ anticipation of global trade uncertainties.

Since Mr. Trump was inaugurated in January, he has launched a series of protectionist policies, with one of them hiking import tariffs imposed on its major trading partners, including the Philippines. Countries are now negotiating with the US regarding the higher “reciprocal” tariffs, which have been suspended until July.

Department of Economy, Planning, and Development Undersecretary Rosemarie G.