Full impact seen partially offset by rising foreign investmentThe Philippines faces a weakening current account and a widening trade deficit over the next two years as exports wane amid a slow global market recovery, the London-based HSBC forecast. Current account, trade gap forecasts“We forecast the [Philippine] current account continuing to moderate through 2018, but a pick-up in capital inflows following potential FDI reform could partly offset the weaker current account,” the bank said. For 2016, it sees the current account surplus narrowing to $3.8 billion from $7.7 billion in 2015. Supporting its current account forecasts, HSBC said manufacturing exports do not look too bright outside electronics, which might lead to a continuation of trade deficits in the Philippines. This year, HSBC sees the trade deficit possibly widening to $38.3 billion from an estimated gap of $33.2 billion in 2016.

Source: Manila Times January 12, 2017 16:40 UTC