Dondi Tawatao
As Asia’s economic giants China and India experience a slowdown, analysts recommend looking at a smaller regional player, which has been delivering on its growth promises.
The Philippines, Southeast Asia’s services-driven economy, expanded by a faster-than-expected 5.9 percent year on year in the second quarter, which takes its first half 2012 GDP growth to 6.1 percent, prompting Barclays Regional Economist Prakriti Sofat to call the country Asia’s “rising star.”
She expects full year growth to exceed the bank’s target of 5.5 percent, and adds that a credit ratings upgrade is also on the cards in the second half of 2013.
“After Indonesia received investment grade ratings, the market’s focus turned to the Philippines as the next potential candidate in Asia,” Sofat wrote in a note.
Increasing foreign direct investment (FDI) in the country, structural improvements – such as the passage of an anti-money laundering bill – and rising political stability will all strengthen the Philippines case to move to an investment grade, says Sofat.
The Asian Century Report 