Reading between the lines of the ADB’s recent evaluation of the Philippines
(The Asian Development Outlook 2009: Southeast Asia Chapter)


The ADB, unlike a lot of our government officials, are a diplomatic and politically correct lot. They churn out country reports about 2x a year discussing the ups and downs of a country’s economic data but without directly dissing anyone. Below is an effort to decipher what the ADB meant in their recent report on the Philippines. The ADB report with subtitles, if you like.

The translations may entirely be the outcome of our fertile imagination.

Brief Summary and Forecast

ADB Statement: GDP growth slowed sharply in 2008, largely reflecting the effects of decade-high inflation on consumption and of weakening global demand for exports. The Government has eased fiscal and monetary stances and plans a stimulus package. These moves should mitigate the slowdown caused by a forecast decline in exports and sluggish domestic demand, and help protect the poor. But they will not prevent a slide in growth this year.
Translation: Let’s not kid ourselves: 2007 was an election year which brought about the unusually high GDP growth, but now it’s back down to reality. The government’s handouts to help the poor are superficial and really not meant to have any permanent effect.

Review of 2008

ADB Statement: Hampered by a surge in inflation and weaker external demand, GDP growth slowed to 4.6% in 2008 from 7.2% in 2007.
Translation: Remember the record-breaking billion peso spending for the May 2007 elections? Well, those days are gone.

Statement: Gross national product, which includes remittances from nearly 9 million Filipinos working abroad, decelerated to 6.1% from 8.0% last year. These remittances rose by 13.7% to $16.4 billion last year, or by about 9% in peso terms, helping support consumer spending. However, rising prices for food and fuel squeezed such spending, which accounts for about 77% of aggregate demand, slowing its growth to 4.5%. Still, private consumption contributed most to GDP growth from the demand side.
Translation: Everything will pretty much be at a standstill without OFW money.

xxx
Read the rest on The Legally Inclined Blog.