MANILA – Philippine monetary officials on Friday announced the revision of the 2019 balance of payment (BOP) projection from a USD3.5-billion deficit to a USD3.7-billion surplus.
In a briefing Friday, Bangko Sentral ng Pilipinas (BSP) Department of Economic Research (DER) Director Dennis Lapid attributed the adjustment partly to the downward revision of the global economic outlook this year.
Additional factors for the change include the moderation of global trade outlook, the expected decline of global commodity prices, global trade tensions, the dovish monetary policy stance in the US, and the good domestic economic prospects.
Lapid said the weaker growth in trade in recent months has resulted in slower global output as well as weaker demand.
“On the global oil market and non-oil exports the expectation is there will be weaker demand and this will push down commodity prices,” he said.
Based on the May 2019 BOP projection exercise, the current account is now projected to be at USD10.1-billion deficit, higher than the USD8.4-billion deficit projection in November 2018.
The country registered a USD7.9-billion current account deficit in 2018 and authorities pointed this to strong rise of imports on account of higher domestic requirements.
The financial account is now projected at around a USD5.2-billion deficit, lower than the USD12.3-billion deficit last November. In 2018, the deficit registered at USD7.8 billion.
Exports are now seen to grow at a slower pace, two percent instead of six percent, while imports are seen to post higher growth of nine percent from the earlier projection of seven percent.
On the local front, Lapid said domestic growth prospects remain positive amid the slower growth of 5.6 percent in the first quarter of the year.
Authorities traced the slip in domestic growth in the first three months this year to the delay in the approval of the 2019 national budget, which was only signed into law last April.
Lapid said that since the budget impasse has been resolved, domestic demand is expected to recover. (PNA)
