Philippines Economy - overview

Economy - overview: Economic growth has averaged 5% since President MACAPAGAL-ARROYO took office in 2001. MACAPAGAL-ARROYO averted a fiscal crisis by pushing for new revenue measures and, until recently, tightening expenditures. Declining fiscal deficits, tapering debt and debt service ratios, and increased spending on infrastructure and social services bolstered optimism over Philippine economic prospects. Although the general macroeconomic outlook improved significantly in recent years, the economy still faces several long term challenges. The Philippines must maintain the reform momentum in order to catch up with regional competitors, improve employment opportunities, and alleviate poverty. The Philippines will need still higher, sustained growth to make progress in alleviating poverty, given its high population growth and unequal distribution of income. The Philippine economy grew at its fastest pace in three decades in 2007 with real GDP growth exceeding 7%, but growth slowed to 3.8% in 2008 as a result of the world financial crisis. High government spending, a relatively small trade sector, a resilient service sector, and large remittances from the four- to five-million Filipinos who work abroad have helped cushion the economy from the current financial crisis.

Definition: This entry briefly describes the type of economy, including the degree of market orientation, the level of economic development, the most important natural resources, and the unique areas of specialization. It also characterizes major economic events and policy changes in the most recent 12 months and may include a statement about one or two key future macroeconomic trends.

Source: CIA World Factbook - Unless otherwise noted, information in this page is accurate as of September 17, 2009