Philippine economy to shrink 0.2% in 2020

The Philippine economy is projected to experience its first annual contraction in over two decades in 2020 due to the coronavirus outbreak, according to the central bank governor.

Central bank Governor Benjamin Diokno estimates that the country's gross domestic product will shrink by 0.2% this year.

A U-shaped recovery is anticipated for 2021, with an expected growth of approximately 7.7%, contingent on the pandemic being contained in the latter half of 2020.

This projection marks a significant downturn from the government's initial growth targets for 2020 to 2022.

Strict quarantine measures remain in place in key Philippine cities, including the capital Manila, extended until May 15.

The central bank has also revised down its inflation forecast for 2020 to an average of 2.0%, citing the collapse of crude oil prices and the pandemic's economic impact.

Inflation is expected to rise to an average of 2.45% in 2021 as economic activity rebounds.