External risks have increased since our last report.Our outlook, which sees GDP growth at 6.1% in 2015 and 6.5% in 2016, is one of guarded optimism that considers robust domestic demand growth alongside softer export demand, increasing foreign investor caution, more volatile global financial markets and risk of a stronger El Nino weather disturbance.
On the political front, President Aquino finally endorsed Interior Secretary Mar Roxas for the 2016 presidential election, while recasting the vote as a referendum for the “Straight and Righteous Path”. We think that other aspiring candidates will take guidance from their rankings in scheduled September polls of voter preference.In the meantime, reform efforts are likely to slow to a crawl.
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