Sun Life Philippines has lowered its gross domestic product (GDP) growth forecast for the Philippines this year, taking into account the effects of the first-quarter recession.

Sun Life Philippines Chief Investments Officer Michael Enriquez said in a virtual conference on Wednesday that the life insurer now forecasts GDP growth to range from 3.9 to 7.1 percent, with a 5.5-percent midpoint.

It shows a decrease from the previous forecast range of 7.5-9.7 percent, with a midpoint of 8.6 percent. The updated estimate is lower than the government’s revised growth outlook of 6-7 percent, although it is better than the Philippines’ 9.6 percent economic drop last year.

In his presentation, Enriquez said that the first-quarter economic downturn of 4.2 percent remains a disappointment as Sun Life had expected a 2 percent drop.

He also noted that the 4.8 percent dive in household consumption and the 18 percent fall in private investment only suggest that the economy’s trust in personal spending, mobility, and forward capital deployment is still gripped by dread of a pandemic.

“So until we can address that, it would probably be difficult for us to really rebound,” the Sun Life executive added.

Sun Life anticipates the economy to return to trendline growth in two years, owing to the fact that household consumption accounts for the majority of domestic output.

Due to protracted delays in vaccine supply deployment and the uncertainty of fiscal stimulus, the company sees that 2021 will be a comeback year, although it will not be as robust as earlier estimates.

According to a Sun Life simulation, the economy will grow 10-15 percent in the second quarter, 6.5-10 percent in the third quarter, and 3-7 percent in the fourth quarter due to low base effects.

Thus, Sun Life projects a longer-than-expected U-shaped rebound in GDP, meaning that the economy would take longer to fully recover.