PH set for solid growth in 2011
S&P sees PH growing 5.1-5.6% this year
MANILA, Philippines—The Philippines and the rest of Asia are poised for another year of solid growth in 2011 even if the impact of the killer earthquake and tsunami on Japan remained unclear, according to global credit watcher Standard and Poor’s.
“We expect the region to record another year of solid growth in 2011 after 2010 proved that Asia is emerging from the [global financial] crisis in a strong position, even as the economic picture for Japan following the recent earthquake remains less clear,” said Tom Schiller, a senior regional analyst. “But growth presents a unique set of challenges for policy makers, officials and investors across the Asia-Pacific region.”
However, S&P said growth for the region with the exception of Australia and New Zealand was expected to moderate slightly from last year because of ongoing worries over the US and euro-zone economies.
The Philippines is expected to grow 5.1-5.6 percent this year from 7.3 percent in 2010.
Powerhouse China is projected to grow 9.1 to 9.6 percent in 2011, lower than last year’s 10.3 percent and this was expected to impact the rest of the region.
“Chinese authorities are adopting measures to rein in expansionary monetary policy to help combat rising inflation, escalating asset prices, and higher wage inflation,” S&P added.
“We expect these tightening measures are likely to prune money supply and credit growth in 2011. Slowing growth in China is likely to drag on growth around the region, in our view, with many nations beginning to post softer growth numbers.”
Japan, which is struggling to cope with the devastation wrought by a magnitude 9 earthquake and tsunami that triggered a crisis at a nuclear power station, is seen growing 1.3-1.8 percent. The world’s third-largest economy expanded 4 percent last year.
South Korea’s economy is projected to grow 4.3-4.8 percent from 6.1 percent in 2010.
Singapore’s growth is to moderate sharply to 4.5-5 percent from 14.5 percent last year, Malaysia is seen expanding 4.8-5.3 percent and Indonesia 5.9-6.4 percent from 6.1 percent.
Thailand’s economy will ease to 4.0-4.5 percent from 7.8 percent.
S&P said inflationary pressure was a key concern for the region, which faced the prospect of tighter monetary policies as authorities sought to temper price rises, it said in its twice-yearly regional outlook.
“Rising prices stem in part from rapid growth and the easy credit conditions that the region’s governments put in place to support their economies during the global financial crisis,” the credit ratings firm said. “We expect the region’s central banks to continue to tighten monetary policy this year.”
That means central banks will raise interest rates to fight inflation.
Standard and Poor’s also said regional central banks might also consider further capital control measures and other actions to prevent risky assets bubbles.
S&P said the credit outlook for the Philippines and other economies in Asia-Pacific remained favorable despite the disaster in Japan.
It noted that while there might be a spillover of the economic effects of the devastation in Japan to neighboring countries, these were unlikely to cause significant trouble. As such, their credit ratings are unlikely to be dragged by the crisis in Japan.
However, S&P said growth for the region with the exception of Australia and New Zealand was expected to moderate slightly from last year because of ongoing worries over the US and euro-zone economies.
The Philippines is expected to grow 5.1-5.6 percent this year from 7.3 percent in 2010.
Powerhouse China is projected to grow 9.1 to 9.6 percent in 2011, lower than last year’s 10.3 percent and this was expected to impact the rest of the region.
“Chinese authorities are adopting measures to rein in expansionary monetary policy to help combat rising inflation, escalating asset prices, and higher wage inflation,” S&P added.
“We expect these tightening measures are likely to prune money supply and credit growth in 2011. Slowing growth in China is likely to drag on growth around the region, in our view, with many nations beginning to post softer growth numbers.”
Japan, which is struggling to cope with the devastation wrought by a magnitude 9 earthquake and tsunami that triggered a crisis at a nuclear power station, is seen growing 1.3-1.8 percent. The world’s third-largest economy expanded 4 percent last year.
South Korea’s economy is projected to grow 4.3-4.8 percent from 6.1 percent in 2010.
Singapore’s growth is to moderate sharply to 4.5-5 percent from 14.5 percent last year, Malaysia is seen expanding 4.8-5.3 percent and Indonesia 5.9-6.4 percent from 6.1 percent.
Thailand’s economy will ease to 4.0-4.5 percent from 7.8 percent.
S&P said inflationary pressure was a key concern for the region, which faced the prospect of tighter monetary policies as authorities sought to temper price rises, it said in its twice-yearly regional outlook.
“Rising prices stem in part from rapid growth and the easy credit conditions that the region’s governments put in place to support their economies during the global financial crisis,” the credit ratings firm said. “We expect the region’s central banks to continue to tighten monetary policy this year.”
That means central banks will raise interest rates to fight inflation.
Standard and Poor’s also said regional central banks might also consider further capital control measures and other actions to prevent risky assets bubbles.
S&P said the credit outlook for the Philippines and other economies in Asia-Pacific remained favorable despite the disaster in Japan.
It noted that while there might be a spillover of the economic effects of the devastation in Japan to neighboring countries, these were unlikely to cause significant trouble. As such, their credit ratings are unlikely to be dragged by the crisis in Japan.
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