by: Sarah Joson
Tuesday, November 22, 2016 |
The Philippine Statistics Authority (PSA) announced last November 17 that the Philippine economy improved by 7.1% during the third quarter of this year.
Director Reynaldo Cancio of the National Economic and Development Authority (NEDA) National Policy and Planning Staff said the bullish 7.1% growth of the Philippines could push the country to meet its targeted 6-7 percent growth for 2016.
The growth reflects the first three months of President Rodrigo Duterte in office. It is higher than the 7% GDP growth recorded in Q2 and higher than the 6% GDP growth posted during the same quarter of last year.
Cancio noted that the growth of the Philippines is higher than China’s 6.7%, Vietnam’s 6.4%, 5% of Indonesia, and Malaysia’s 4.3%.
Moreover, it was realized that the Philippines was the fastest-growing major Asian economy for the first six months of the year, even surpassing Asia’s chief player - China.
The growth data is on track with the government’s projections and has exceeded analysts’ expectations. Before data was released, Socioeconomic Planning Secretary Ernesto Pernia predicted that the GDP for Q3 will probably land anywhere between 6.3% and 7.3%.
Cancio attributed the growth to the investments coming from the demand side that continued to drive economic growth. He also explained that construction investments coming from the private sector rose significantly by 16.2% this quarter from the 4% recorded last year. As for the public sector, strong investment in infrastructure was sustained with a 20% growth in the third quarter.
Other factors that contributed to the growth in private consumption are low inflation and interest rates, “better labor market conditions, and the steady, though slower growth” of remittances coming from OFWs.
However, Cancio noted that the government is keeping an eye on possible threats to the economy, even though it posted strong growth in the 3rd quarter. He cited several factors such as the effects of La Niña to the agriculture and fishery sectors of the country, vague economic policies in UK and the US, sluggish recovery in Europe, and employment challenges in the Kingdom of Saudi Arabia.