Transport, construction yet to recover 2019 levels — WB

THE Philippine transportation, construction and real estate industries have yet to recover pre-pandemic levels of business, according to the World Bank (WB).

“The recovery has been uneven across sectors,” the bank said in its East Asia and Pacific (EAP) Economic Update.

“Output in transportation, accommodation and catering sectors in the Philippines and Thailand, and construction and real estate in Malaysia and the Philippines are still well below pre-pandemic levels,” it said.

Terry L. Ridon, a public investment analyst and convenor of think tank InfraWatch PH, said this year could mark a recovery for these industries if their growth trajectory is sustained. 

“We have to continue expanding the IT-BPO (information technology-business process outsourcing), semiconductor and tourism sectors. We have to broaden opportunities for foreign capital investments, such as private-led flagship infrastructure projects,” he said in a Viber chat.

The bank also noted that the information and communications technology, finance, and services sectors in the EAP are relatively strong, while the service sector is bound to recover due to pent up demand.

Manufacturing in the region surged following the coronavirus pandemic, but has recently slowed down.

However, the bank noted that the Philippines and Thailand were the two countries thought to have exceeded pre-pandemic levels in terms of output per capita by the end of 2023.

Among developing countries in the EAP, private investment as a share of GDP (gross domestic product) remains lower than pre-pandemic levels, the WB added. 

“Public investment generally supported economic activity during the pandemic and exceeded the pre-pandemic levels in terms of GDP share in Indonesia, the Philippines, Thailand, and Vietnam,” it added.

The World Bank projects economic growth for EAP at 4.5% this year and 4.3% for 2025. However, this is weaker than the region’s projected 5.1% GDP in 2023.

Meanwhile, the bank maintained its 2024 growth forecast for the Philippines at 5.8%, the strongest in Southeast Asia alongside Cambodia.

For 2025, the bank raised its GDP projection for the Philippines to 5.9%. — Beatriz Marie D. Cruz