MANILA, Philippines — The Philippine economy is unlikely to sustain growth above 6 percent over the next two decades as low productivity, weak manufacturing and the concentration of workers in low-productivity sectors weigh on expansion, according to economists from De La Salle University (DLSU).
In their latest book, “The Philippine Economy Toward 2050,” launched Wednesday, the economists projected that economic growth would gradually slow to about 5.1 percent by 2040 and 3.6 percent by 2050.
They forecast average annual growth of 4.8 percent from 2024 to 2050, below the government’s 6.5-percent to 8-percent long-term growth target under AmBisyon Natin 2040.
The projections assume that the country will not experience another major economic crisis during the period. DLSU said a crisis could further delay economic progress and the country’s transition to high-income status.
The economists said the Philippines would continue to make economic progress, with rising per-capita income and declining poverty, but warned that the pace could fall short of government targets.
DLSU said the projected growth rates would also make it unlikely for the Philippines to reach its goal of becoming a trillion-dollar economy by 2033 or a $6.6-trillion economy by 2075.
The economists also projected a poverty incidence of 7.9 percent by 2040, making a zero-poverty economy unlikely under current conditions.
“Achieving a 7-percent growth rate and sustaining it is unlikely,” the economists said. They added that consistently maintaining even 6-percent growth for the next 25 years would be difficult.
A major constraint is the economy’s labor structure, with many workers remaining in agriculture and low-productivity services.
DLSU also identified manufacturing as a weakness. Manufacturing and wholesale and retail trade are expected to remain among the economy’s largest sectors, together accounting for nearly 40 percent of GDP, but their shares are not projected to change significantly.
Agriculture’s share of GDP is expected to fall to about 4 percent by 2050 as its workforce declines and low productivity continues to limit the sector’s contribution to economic growth.
DLSU estimated that another major crisis could reduce gross national income per capita in 2050 by about $1,400 and delay economic progress by three years.
The economists said a slower recovery could further limit real wage growth, slow poverty reduction and postpone the country’s transition to high-income status.
