Vietnam to overtake PH economy

While the Philippines' climb to upper-middle-income-country (UMIC) status is attainable in the medium term, the country will be surpassed by neighboring Vietnam, which would jump to become a high-income economy 15 years from now, according to Singapore-based DBS Bank Ltd.

- BY BEN ARNOLD DE VERA

The Philippines, Indonesia, Malaysia, Singapore, Thailand, and Vietnam-collectively known as the Association of Southeast Asian Nations (ASEAN)-6-is expected to become the world's fourth-biggest economy by 2030, according to a July 29 report authored by DBS Group Research senior economists Han Teng Chua and Radhika Rao.

DBS cited that ASEAN-6's nominal gross domestic product (GDP) has quadrupled over the past two decades, driven by strong domestic demand, investment, and export tailwinds.

The Singaporean bank projected that from 2025 to 2040, ASEAN-6 would grow at an average real GDP rate of 4.8 percent, outpacing China, with growth fueled by capital investment and productivity gains.

"Most of ASEAN-6, including Indonesia, Malaysia, and Thailand, are currently in the upper-middle-income status, according to the World Bank, while the Philippines and Vietnam lag as lower-middle-income countries. Singapore, which is in the high-income status, is by far the most developed and wealthiest economy in the region," DBS noted.