By Anna Leah Gonzales

INFRASTRUCTURE PROJECTS. Construction workers lay cement on the base of an infrastructure project being built along West Avenue in Quezon City July 14, 2023. A report released by First Metro Investment Corporation and the University of Asia and the Pacific expects infrastructure spending to be one of the drivers of economic growth in 2024. (PNA photo by Robert Oswald P. Alfiler)

MANILA – Philippine economic growth is projected to accelerate in the first quarter of the year, mainly driven by the government’s infrastructure spending, a report released by the First Metro Investment Corporation (FMIC) and the University of Asia and the Pacific (UA&P) said.

In the latest issue of The Market Call released on Monday, FMIC and UA&P forecast the country’s gross domestic product (GDP) to grow by 6.1 percent in the first quarter of the year.

“The economy looks set to accelerate in 2024 with Q1 (first quarter) GDP estimated at 6.1% as infrastructure spending goes into high gear with national government (NG), buoyed by ODA (official development assistance) funding, and PPP (public-private partnership) projects gain traction,” the report said.

FMIC and UA&P expect NG and infrastructure spending to accelerate this year.

“We expect NG to have a strong start in 2024 after the understandable tentativeness of the different departments at the start of 2023 when the then new administration had just been in an organizational mode,” FMIC and UA&P said.

“Infrastructure spending, both government-funded [i.e., huge PHP1.0-trillion Department of Public Works and Highways budget alone] and PPP projects, should accelerate in 2024 as NG bids out and awards large undertakings starting with the recent $3.0-b(illion) Ninoy Aquino International Airport (NAIA) expansion,” they added.

Meanwhile, inflation, which accelerated to 3.4 percent in February, is projected to remain within the government’s 2 to 4 percent target for this year.

“We also don’t see a repeat of the February inflation spike as rice prices abroad had begun to ease while crude oil prices have little upside given the weak China economic recovery and surplus capacity in both OPEC (Organization of the Petroleum Exporting Countries) and non-OPEC countries,” the report said.

FMIC and UA&P forecast headline inflation to settle at 3.7 percent in the first half of the year, and decelerate to 3.5 percent in the third quarter. (PNA)