Economy expands 7.5% in 2nd quarter-A A +A
Thursday, August 29, 2013
THE Philippine economy grew beyond 7 percent for the fourth consecutive quarter, officials said Thursday, as the country retained its distinction as the top performer in Asia along with China.
The April to June GDP expansion of 7.5 percent has brought the first semester growth to 7.6 percent after revising the first quarter growth to 7.7 percent from 7.8 percent, said Jose Ramon Albert, secretary general of the National Statistical and Coordination Board (NSCB) in a press conference.
Gross domestic product or GDP refers to the total value of all goods and services produced in a country over a specific period of time. GDP growth rate is a primary indicator of a healthy economy, which in turn should reflect on lower unemployment, higher wage rates, and better investment and profit rates, according to the US-based CNBC.
"The resilient services sector, which grew by 7.4 percent, remained the main driver of the country’s growth supported by the 10.3 percent and 17.4 percent growth of manufacturing and construction, respectively boosting the industry sector to grow by 10.3 percent," he said.
On the demand side, he said the growth came mainly from consumer and public spending buttressed by increased investments in fixed capital.
External trade has been lackluster as exports in the first half of 2013 dipped 4.4 percent to $25.58 billion.
Socioeconomic Planning Secretary Arsenio Balisacan said the second quarter growth only confirms that the Philippine economy is now on a "higher growth trajectory."
He noted the second quarter growth was above the 6-7 percent target set by the Development Budget Coordination Committee (DBCC) for this year and within the target range of 7-8 percent GDP growth as originally outlined in the Philippine Development Plan or PDP for 2011 to 2016.
The Philippines has remained the the fastest growing economy among emerging economies in Southeast Asia.
Balisacan said the Philippines matched the growth posted by China. Indonesia grew by 5.8 percent; Vietnam by 5 percent; Malaysia by 4.3 percent; Singapore by 3.8 percent; and Thailand by 2.8 percent.
For countries outside Southeast Asia, Hong Kong had 3.3 percent, Japan registered 2.6 percent, Chinese Taipei posted 2.5 percent, and South Korea grew 2.3 percent.
These countries tend to be resource-driven and export-dependent, said Finance Secretary Cesar Purisima.
"I am confident that market players will recognize the strong fundamentals of the country—including our strong external position and banking system, stable inflation, and a well managed fiscal position. All of this is topped by a reform-oriented political leadership with a very strong mandate,” he said.
Balisacan, who is also the director general of the National Economic and Development Authority (Neda), noted the composition of the country's economic growth showed “signs” of moving from being largely consumption-driven to becoming investment-led and industrialized.
"With strong macroeconomic fundamentals, our country has the means to manage risks that arise with volatilities, including those of the stock market and Philippine peso. Inflation remains stable; interest rates continue to be low; and our current account is so strong that we can cover 12 months worth of imports," he said.
Balisacan added the government remains committed to sustaining growth and making it more inclusive. (Virgil Lopez/SDR/Sunnex)