The Philippines’ Economy Set to Double by 2029

Analysts predict that Philippine GDP will go from $300 billion in 2015 to $500 billion by 2020. From there, GDP will double to $1.05 trillion by 2029. The nation’s GDP per capita will increase from $3,000 to $6,000 by 2024. The Philippines can create a long-term growth capacity of 5.5 percent each year from 2016 to 2020.

Analysts predict that Philippine GDP will go from $300 billion in 2015 to $500 billion by 2020. From there, GDP will double to $1.05 trillion by 2029. The nation’s GDP per capita will increase from $3,000 to $6,000 by 2024. The Philippines can create a long-term growth capacity of 5.5 percent each year from 2016 to 2020.

The Philippines becoming a trillion-dollar economy is news within itself, but the rise in per capita is particularly noteworthy because the nation will become one of the biggest consumer markets in the region. The per capita boost stems from a rising middle class in the country and foreign direct investment (FDI). A higher standard of living and an increase in consumerism translate into more investment from abroad, most notably in the manufacturing and service sectors.

Growth Spots

The manufacturing sector is important because the country must compete on domestic and international levels to secure long-term prosperity. Fostering growth in these areas also means building the necessary infrastructure, such as roads and generators, to attract more investment and keep the economy growing. The country ranked low in terms of business climate, but FDI skyrocketed 66 percent in 2014.

Remittances from workers abroad and growth in IT contracts remain vital. Remittances increased to $26.9 billion in 2014, which is a boost of 6.2 percent from 2013. Around 35 percent of remittance income flows into the home market, fueling the property and construction sectors and the growth expects to last throughout 2015 and 2016. The construction sector grew 10 percent in 2014, with continued expansion forecasted for 2015.

IT outsourcing reached $13.3 billion, doubling between 2008 and 2014. Growth in this industry also benefits the commercial property sector, especially in urban areas and office complexes. Outsourcing within IT will reach 1.3 million employees by 2016, and the increase enhances economic development in such Filipino cities as Cebu and Manila.

Current Obstacles

Economic projections remain solid, but the government must instill various reforms to attract more investment. First, officials must tackle issues of rampant poverty and high unemployment. Unemployment surpasses 10 million, and 28 percent of citizens still live in poverty. Further, Filipino leadership must address the country’s high crime rates in urban centers to attract more home and foreign investment, but the issue of crime ties into the economy. A surplus of quality jobs, and a rise in the standard of living, will lift many people out of poverty and decrease crime rates.