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MANILA - Tax reform, remittances from overseas Filipinos and growing demand for higher-skilled workers in the outsourcing industry will drive economic growth next year, an analyst said Friday.

However, tensions in the Korean peninsula and the economic restructuring in Saudi Arabia, which hosts 3 million Filipino workers, could pose risks, said First Metro Investment Corp research head Cristina Ulang.

Tax reform, which will lower income tax rates, will empower the middle class. Additional revenue from new duties will help fund the government's infrastructure program, Ulang said.

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“You have the purchasing power so it is going to be a great consumer story for the Philippine economy next year, consumer driven, investment driven and government driven in terms of our growth and because of this we are very bullish on the growth of the main market index PSEi,” she said.

Ulang said opportunities in Japan, New Zealand and Canada could offset potential losses in Saudi Arabia.

Growing demand for high skilled jobs such as graphics and web design will allay concerns of job losses due to artificial intelligence in the business process outsourcing industry, she said.

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