Fitch revises PH GDP growth to 4% due to COVID-19

Fitch Solutions has downgraded the Philippines' 2020 GDP growth forecast to 4% due to the economic impact of the COVID-19 pandemic.

Socioeconomic Planning Secretary Ernesto M. Pernia stated that Philippine economic growth may slow to 4.3% or even lower if the coronavirus disease 2019 (COVID-19) continues to spread and the Luzon-wide lockdown extends into the second semester.

This revised forecast represents a significant slowdown from the 5.9% growth seen in 2019 and is the country's slowest growth since 2011.

The think tank cited tourism, remittances, supply chain disruptions, and foreign direct investment as channels through which the Philippine economy will be affected.

However, Fitch Solutions now believes that the most substantial negative impact on growth will stem from the quarantine measures implemented within the country following a severe outbreak.

The government placed Luzon under enhanced community quarantine from March 17 to April 12 to contain the rise of COVID-19 cases.

Fitch Solutions expects fiscal stimulus and public infrastructure projects to support a rebound once the outbreak is contained.