DAVAO CITY (MindaNews / 18 Aug) – The Philippines is the fastest growing economy in Asia after it posted a gross domestic product (GDP) growth of 7 percent in the second quarter of this year, outperforming even the economic giant China, which grew at 6.7 percent.
In a press conference on the 2nd quarter 2016 report on the Philippine economy, National Economic Development Authority (NEDA) Director Ernesto Pernia said the country’s second quarter economic performance this year is higher than the 6.8-percent GDP growth recorded in the first quarter.
The second quarter growth also surpassed the 5.9-percent growth noted in the same period of 2015.
“Among the major emerging economies – Asian economies – the Philippines likely remains the fastest or second fastest, at least among the growing economies, in the second quarter of 2016, followed by China which grew at 6.7 percent, Vietnam at 5.6 percent, Indonesia at 5.2 percent, Malaysia at 5 percent, and Thailand at 3.5 percent,” Pernia said
The second quarter GDP is well also within the 6.1 to 7.2 percent market expectation for the current period, he noted.
Pernia said the growth in the second quarter is boosted by the industry sector with 6.9-percent growth from 6.1 percent during the same period last year, and the services sector, expanding to a growth of 8.4 percent from 6.7 percent.
Biggest GDP growth contributor was the services sector at 4.8 percentage points, industry sector 2.3 percentage points, but agriculture sector posted a -0.2 percentage point.
He said the growth improves the country’s probability to attain the revised 2016 Development Budget Coordinating Committees approved projection of 6 to 7 percent by end of the year.
The NEDA chief said the previous administration left a strong and stable economy posting at a strong 6.8-percent growth in the first quarter of the year that made it possible to sustain the growth.
He vowed to keep the existing sound macroeconomic and fiscal monetary policies of the previous administration.
“It is also encouraging to note that the growth has been investment-driven. However, the challenge is to make this growth inclusive so that more people contribute to and benefit from it,” Pernia said.
He also emphasized to develop the competitiveness of the markets and improve the business climate to leverage on the new stage of investments in the region.
Pernia added they need to help the least performing sectors and geographic areas to benefit from the new opportunities.
Battered by El Niño during the first semester of the year, the agriculture sector dragged the GDP after it decelerated to 2.1 percent from 0.1 percent during the same period of 2015.
“The performance of the agriculture remains dismal at -2.1 percent due to the effects of El Niño. There is also a developing risk of La Niña phenomenon that will likely intensify between the months of August and October this year,” he said.
This dismal growth signals for a crafting of wholistic development policies that include disaster resiliency to counter the impact of calamities on the agriculture sector that employs the most number of the country’s labor force.
Household consumption, meanwhile, strengthened, posting a 7.3-percent increase in the second quarter from 6.4 percent of the same period in 2015 while government consumption expanded to to 13.5 percent from 2.4 percent.
Investments also strengthened to 27.6 percent in the second quarter in 2016 from 21.4 percent of the same period last year.
The exports also grew at 6.6 percent in the second quarter as compared to 5.1 percent recorded during the same period last year, while the imports expanded to 20.9 percent from 12.6 percent. (Antonio L. Colina IV / MindaNews)