A recent study by the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) forecasts that the Philippines will continue to experience economic growth for 2015. According to the report, the country’s economy is expected to expand at around 6.5% relative to its 6.1% growth in 2014.
The predictions were slightly lower than the country’s estimates mostly due to certain legislative challenges that slowed down government spending. Nevertheless, there was still growth which was primarily driven by consumer spending, the continued drop in global oil prices and the sustained growth of the services sector.
The increase in consumer spending was brought about by several factors including improvements in the labor market and steady remittances of overseas workers.
The country’s investment landscape also improved last year, with investments in equipment as well as exports of electronics and apparel continuing to exhibit an increasing trend. Meanwhile, the services sector of the economy, specifically the business process outsourcing sector also showed promise with the country overtaking India as the call center capital of the world. The BPO industry is said to employ over 1 million call center agents and support personnel in related outsourcing businesses.
Furthermore, the services sector is expected to drive growth, with the business process outsourcing industry to generate around $25 billion in revenues by 2016 or approximately a tenth of the nation’s gross domestic product (GDP).
The government plans to sustain this growth into the future by improving government spending and partnering with private companies to improve the country’s infrastructure. In fact, the country has worked hard to boost tax revenues and enhance public-private partnerships (PPP) to develop its infrastructure at a target of 5% of the GDP by 2016.
The Philippines has slowly but steadily improved its economic standing in the global stage. The country has seen improvements in foreign investments as well as receiving credit rating upgrades from various financial institutions.