The Philippines may become the second fastest growing economy in the Asia Pacific region next year following its severe contraction this year, the research arm of debt watcher Moody’s said.

Steven G. Cochrane, Moody's Analytics economist, said that India and the Philippines will see some of the strongest gross domestic product (GDP) growth rates in 2021, but this is largely due to base effect, or abnormally low levels of their economies this year.

While Moody's Analytics’ 2021 GDP forecast for the Philippines provides some good news for Filipinos struggling to contain the coronavirus, Cochrane clarified that this forecast remains “the most uncertain.”

Cochrane explained the Philippines has neither clearly shown that it has effectively controlled the COVID-19 pandemic, nor has either committed fiscal resources toward recovery to the degree seen in other countries.

The Moody's Analytics economist added the Philippine government needs to continue spending to support economic recovery in the near term.

“The greatest need for further fiscal support is in India, Indonesia and the Philippines,” Cochrane pointed out.

However, the Duterte administration’s chief economic manager would not bow-down to pressure to increase the government’s economic stimulus to cushion the impact of the pandemic-induced crisis.

Finance Secretary Carlos G. Dominguez III earlier said their P180 billion economic stimulus plan will remain unchanged to keep the national government’s budget deficit in check.

Dominguez explained the stimulus plan, which incorporates around P40 billion in tax credits to the private sector, already taken into account any deep economic contraction this year. He also said the government’s borrowing plan to cover a massive funding for both coronavirus response and economic recovery program is in place and will be sufficient to cover the country’s requirements for this year and next.