RETAILERS are optimistic about growth in the coming months, buoyed by the country’s strong economic performance and the anticipated boost from the upcoming “ber” months.
“We expect gross domestic product (GDP) growth to continue into the next quarter, driven by the uptick in July, which has been boosted by the start of the school year and increased consumer spending leading into the ‘ber’ months,” said Robert Go, spokesman of the Philippine Retail Association Cebu Chapter and owner of Prince Retail Group.
The Philippines is known for having the world’s longest Christmas celebration, which begins as early as September with the onset of the “ber” months. This period, from September to December, is widely recognized as a peak season in business, driving an upswing in the consumer-driven economy.
The Philippines capped the first half of the year with a six percent growth in the second quarter, posting 6.3 percent, driven by robust construction and infrastructure spending. The country’s second-quarter growth beat that of Malaysia (5.8 percent), Indonesia (five percent) and China (4.7 percent).
The Marcos’ economic team hopes to end the year with a six to seven percent GDP growth.
Go said that before June, the country faced sluggish growth due to weak consumer spending, but there has been a significant surge over the past two months. The government’s ramped-up infrastructure spending and rising imports suggest stronger domestic demand, though exports and agriculture have declined.
Central Visayas is experiencing growth in line with the rest of the country, although its inflation rate remains higher than the national average.
The recent inflation spike is mainly due to increased prices of agricultural products affected by El Niño.
The inflation rate in the country accelerated to 4.4 percent in July, up from 3.7 percent in June. Inflation in Central Visayas, meanwhile, jumped to 4.5 percent from 3.7 percent in June.
“Despite high inflation, Central Visayas is seeing GDP growth driven by increased consumption, further boosted by the government’s 4Ps program, which has helped raise spending in rural areas,” said Go.
Meanwhile, according to reports, Fitch Group unit BMI downgraded its Philippine economic growth outlook for the year to grow by six percent, lower than its initial projection of 6.2 percent.
It said that for the country to attain the previous projection of 6.2 percent, “the economy must expand by around 6.4 percent in the second half, which we think is unlikely.”
“The 6.3 percent growth outturn in the second quarter paints a misleading picture of the economy’s health, as this number was flattered by a favorable base of comparison. Output grew by just 4.3 percent in the second quarter of 2023,” it said. (KOC)