The Philippine economic recovery improved amid declining new coronavirus infections and easing quarantine restrictions, Moody’s Analytics said.
In a research note on Monday, July 5, the US-based economic and financial think tank said business activities in the country are expected to pick up in the coming months owing to improving outlook.
Moody’s Analytics, which in May labeled the Philippines as the “clear laggard” in Asia, noted that while COVID-19 wave is raging in parts of Southeast Asia, the daily new infections in the country have tamed after breaking records earlier this year.
“The outlook for the Philippines has improved. The country has seen a decline in daily new infections after breaking records in the region earlier this year. New cases fell from a peak of more than 11,000 daily to half that level now,” Moody’s Analystics said.
The global think tank also expects further easing of quarantine restrictions this month.
On Sunday, the Inter-Agency Task Force for the Management of Emerging Infectious Diseases eased the rules for interzonal travel for individuals fully vaccinated against COVID-19.
“The Philippines’ retail activities are expected to gradually pick up in line with eased restrictions from mid-July,” Moody’s Analytics said. “Declining COVID-19 cases in the Philippines pave the way for its economic recovery as retail activities start to pick up.”
However, Moody's Analytics said the country needs to step up its vaccination efforts, as “the sluggish campaign leaves it vulnerable to fresh resurgences.”
The Department of Health had said the Philippines was categorized as low risk from the COVID-19 after declining infections in the past two weeks. Areas in Metro Manila, once the epicenter of virus, have also showed the lowest cases.
In May, Moody’s Analytics said the Philippines has fallen behind on recovery compared with its Asian peers due to difficulty in containing local infections, particularly the spike in early April.
For that reason, “this makes the Philippines the clear laggard in Asia,” Moody’s Analytics said in its May 24, 2021 report.
The US-based think tank expects the Philippine gross domestic product (GDP) will grow by 5.3 percent this year, below the government’s newly revised target of 6.0 percent to 7.0 percent.
“The Philippines is not forecast to return to pre-pandemic output levels (defined as the December quarter of 2019) until the final quarter of 2022,” it said.