A HIGH-RANKING government official said they are having concerns with the slower third quarter growth of the Philippine economy.
Socioeconomic Planning Secretary Ernesto Pernia during the Press Conference on the Performance of the Philippine Economy For the Third Quarter of 2018 on Thursday, November 8, said that Philippines "grew at a respectable pace in the third quarter of 2018 at 6.1 percent from the second quarter of 6.2 percent."
"We are concerned about the third quarter growth numbers, not because it fell below expectations, which stood at 6.3 percent. We are concerned about this slowdown, not because it makes the DBCC growth target for the year much more challenging. Rather, we are concerned, because the reason for the slowdown, among others, is the slowdown in household consumption, particularly the marked slowdown in the household spending on food and other basic products," Pernia said.
He said household final consumption demand grew by only 5.2 percent in the third quarter from a growth of 5.9 percent in second quarter.
"Food and Non-alcoholic Beverages, sharing 40.1 percent of the total household expenditure, posted a slower growth of 2.8 percent compared with the 4.3 percent growth recorded a year ago," PSA said in a statement.
It can be noted that various factors have been driving the cost of basic goods up. Among these are the increase in excise taxes and rising oil prices that have been driving inflation in the country in recent months.
In Bangko Sentral ng Pilipinas' (BSP) Consumer Expectations Survey for third quarter 2018, consumer outlook was pessimisitic
"Consumer outlook across income groups weakened for the current quarter, next quarter and year ahead. For Q3 2018, the outlook of the low- and middle-income groups was pessimistic given their expectations of higher household expenditures and no increase in income. Meanwhile, the high-income group was less buoyant as they anticipated peace and order problems and peso depreciation," BSP said in their survey.
However, Pernia said they are confident that the measures the govrenment has implemented will help increase or strengthen consumer confidence and tame inflation.
"Administrative Order No. 13, which was issued in September this year, streamlined administrative procedures covering the importation of food products. In October, we have seen a softening of food inflation, but it remains high," he said.
Meanwhile, despite the slower growth in the third quarter, the Philippines is still among the fastest growing economies in Asia just behind Vietnam (7%) and China (6.5%).
"Moreover, even as domestic demand is expected to return to high gear this fourth quarter due to the holiday season, we will continue addressing upward pressures on prices, especially on food," Pernia said.