World Bank: Philippines to remain one of fastest-growing economies in East Asia

The Philippine government is embarking on an ambitious $180 billion infrastructure program aimed at accelerating growth and creating 12 million new jobs through these projects. (Courtesy World Bank)
Updated 07 June 2018
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World Bank: Philippines to remain one of fastest-growing economies in East Asia

DUBAI: The Philippines would sustain its robust economic growth and remain one of the top-growing countries in East Asia and the Pacific until 2020, the World Bank said on Wednesday.
The Washington-based multilateral lender, in its latest report, projected the Philippine economy to grow 6.7 percent this year and in 2019, and 6.6 percent in 2020. The forecasts were however considerable lower than the government’s medium-term target of between 7 percent and 8 percent from 2018 until 2022.
“Growth in the Philippines and Vietnam remains robust, but capacity constraints (e.g., high capacity utilization rates) limit further acceleration, especially in the Philippines,” the World Bank’s June Global Economic Prospects report noted.
Among other East Asian and Pacific nations, Cambodia and Vietnam will outpace the Philippines’ gross domestic product (GDP) growth this year at 6.9 percent and 6.8 respectively, while China will lag a little at 6.5 percent GDP growth for 2018.
India’s economy, to which the Philippines is usually compared, is expected to grow by 7.3 percent this year and then accelerate to 7.5 percent in 2019 the year thereafter.
“Overall, the region benefits from solid fundamentals, including moderate domestic and external imbalances and significant policy buffers,” the World Bank noted in its report, although it cautioned some countries in the region continued to confront financial sector vulnerabilities.
The Philippines, including China and Vietnam, continues to experience fast credit growth while countries such as Malaysia, Laos and Thailand had to deal with elevated levels of debt. Cambodia and Vietnam also had to contend with their sizable fiscal deficits, the World Bank said in the report.
On a broader scale, the Bank said that regional growth would gradually moderate from a 6.8 percent clip in 2018 to 6.1 percent in the next two years.
“The slowdown in regional growth is largely due to the gradual structural slowdown in China the region’s largest economy. Activity in the rest of the region is expected to peak in 2018 and remain steady around its potential rate in 2019 and 2020,” the World Bank said. “The outlook is predicated on broadly stable commodity prices in the next two years, solid but moderating global demand, and a gradual tightening of global financing conditions.”


UAE indicates full compliance with US sanctions on Iran

Updated 19 November 2018
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UAE indicates full compliance with US sanctions on Iran

  • The US announced on Nov. 5 a series of sanctions targeting Iran’s banks, shipping sector, national airline and 200 individuals
  • UAE’s trade with Iran, which is expected to decline further, fell to $17 billion in 2017 from a peak of $20 billion in 2013

DUBAI: The United Arab Emirates is fully complying with sanctions imposed this month by the United States on Iran even though it will mean a further drop in trade with Tehran, said a UAE economy ministry official.

Abu Dhabi, the political capital of the UAE federation, has taken a tough stand on Tehran, although Dubai, the country’s business hub, has traditionally been a major trading partner with Iran.

Washington announced on Nov. 5 a series of sanctions targeting Iran’s banks, shipping sector, national airline and 200 individuals after President Donald Trump pulled the United States out of an international nuclear deal with Tehran.

“We are implementing the sanctions,” Abdullah Al-Saleh, undersecretary for foreign trade and industry, said in an interview in Dubai.

 

The UAE is enforcing the US sanction regime “as it is published by the United States,” Al-Saleh said, adding that the relevant authorities would ensure compliance.

Al-Saleh said the UAE’s trade with Iran is expected to decline this year and next year due to the sanctions, after falling to $17 billion in 2017 from a peak of $20 billion in 2013.

Most trade consists of re-exports via Dubai to Iran, which lies across the Gulf.

The sanctions are part of a wider effort by the Trump administration to diminish Iranian influence in the Middle East.

The UAE is among US allies in the Gulf region that staunchly oppose Iranian foreign policy and swiftly backed Washington’s decision. It is also a member of a coalition that is opposing the Iran-aligned Houthi group in Yemen’s civil war.

Compliance will mean UAE companies do not face difficulties in the United States, and the UAE government will look to boost trade with other markets such as Africa and Asia to offset the impact of the sanctions on its own economy, Al-Saleh said, repeating an existing government policy to diversify trade.

Trump’s administration has threatened those who continue to do business with Iran with the prospect of losing access to the US market, although it has given temporary exemptions to eight importing countries to keep buying Iranian oil.

The European Union, France, Germany and Britain, which are trying to save the nuclear deal, have said they regret the US decision and will seek to protect European companies doing legitimate business with Tehran.

FACTOID

The US has given temporary exemptions to eight importing countries to keep buying Iranian oil.