An executive of the International Monetary Fund (IMF) has forecast the Philippine economy to expand by 6.3 percent in the first quarter of the year despite the impact of the novel coronavirus (2019 nCoV).
In a briefing on Tuesday, IMF Resident Representative to the Philippines Yongzheng Yang projected the first quarter growth at around that range.
Yang declined to give figures on the impact of the 2019 nCoV on domestic growth, saying they are not experts on this but cited that economic managers have placed this at about 0.3 percent of the gross domestic product (GDP).
He said the obvious negative impact would be on tourism given the travel ban imposed by the government on tourists directly coming from China, Hong Kong, and Macau, as well as those not directly coming from these areas but have traveled to these destinations within 14 days before their arrival in the Philippines.
Yang said China is among the Philippines' largest sources of tourists, thus, the travel ban would hurt the sector.
Another area expected to be negatively hit by the anxieties on the virus is the global value chain, which would also affect the Philippines, he added.
Asked for measures that the government should implement to help address the economic impact of the virus outbreak, which was first recorded in Wuhan, China last December, Yang cited as a good response the 25 basis point reduction in the Bangko Sentral ng Pilipinas (BSP) key policy rate last week.
Macroeconomic policy has a role to play if the impact would be larger. There can be further consideration of macro policy responses, he said.
Since no one knows until when the problem would last, Yang added that authorities need to monitor this development and be ready to take necessary actions to support the economy and support the industry that might be affected by the outbreak.
Source: Philippines News Agency