Having a population growth of 1.6 percent, we are on a demographic sweet spot. Our median age is still 24.5 years so we are not like other countries that are way beyond 50 or 60.

The country’s median age is still 24.5 years, unike other countries that are way beyond 50 or 60. But when this rises to 30, the population starts to build families and thus reducing disposable income.

Although the Philippines has kept its spot as among the fastest growing economies in the region, the government needs to make full use of events that has kept it within a so-called demographic sweet spot.

BDO Unibank Inc. vice president and chief strategist Jonathan Ravelas pointed out, for instance, that domestic spending, which accounts for more than half of the country’s local output measured in gross domestic product (GDP), should moderate at some point forward as consumption priorities shift.

“Having a population growth of 1.6 percent, we are on a demographic sweet spot. Our median age is still 24.5 years so we are not like other countries that are way beyond 50 or 60,” Ravelas said at the year-end economic briefing in Taguig City hosted by the Financial Executives Institute of the Philippines (FINEX).

“So, as income slowly improves, you get to see recoveries in spending power. Remember that (when) 24.5 goes to 30, (the population) starts to build families so this is no longer the disposable income that for every three-day holiday, you travel,” he added.

However, Ravelas said the authorities cannot afford to relax as the demographic advantage is not forever and thus the need to look for other means to sustain GDP expansion.

“It’s going to change. Right now, we’re there but if we don’t really move fast in probably shifting to manufacturing as an economy, we could have speed bumps,” he said.

Philequity Management Inc. vice president Miguel Agarao said the country’s reduced exposure to external factors helped cushion the effects of the ongoing trade dispute between the US and China.

“Our GDP is about 60 plus percent domestic consumption, which is why the trade war’s impact on us is not as great as it is in countries like Japan. That’s helping the Philippines in this particular situation,” Agarao said.

Manila-based academic Richard Heydarian, for his part, considers the 6 to 7 percent growth target set by government inadequate and for the economy to expand in double-digits instead.

“Honestly, we should grow at 8 to 12 percent. I think double-digit growth should be the normal mode. If you look at Vietnam, China, Thailand, Malaysia and even Indonesia, they are growing at a much higher rate,” Heydarian said, noting that some of these countries even grew under more difficult conditions than the Philippines.

“Indonesia’s politics is even more crazy than us. They have three times more islands than us. They have bigger problems than us and 8 to 10 percent should have been normal for us. Six to seven percent growth is not good enough,” he added.

He expressed hope the time would come the Philippines need not merely be resilient anymore but “do well good enough” on its own.

“I hope we don’t have to be simply resilient anymore. We do well enough and make the most out of the sweet spot. But that window is closing,” Heydarian said.

“Also, (we need) to have some growth in terms of agriculture (and) the manufacturing sector for long-term development,” he added.

Earlier, the economic managers remained firm the country’s growth should average within the 6 to 7 percent target band no matter that the first six months show growth averaging only 5.5 percent.