The Philippine economic growth topped market expectations in the third quarter of 2017 on strong growth in exports and public spending, making the country still one the best performing economies in Asia.
The gross domestic product (GDP), the total value of all the goods and services produced in the country, grew 6.9 percent in July to September quarter from 7.1 percent during the same period last year.
Socioeconomic Planning Secretary Ernesto M. Pernia said the Philippines likely ranked second in Asia in the third quarter, next to Vietnam’s 7.5 percent and ahead of China’s 6.8 percent and Indonesia’s 5.1 percent.
“With a year-to-date growth average at 6.7 percent, we are optimistic that we are on track in meeting the full-year target range of 6.5 to 7.5 percent GDP growth for 2017,” he said in a press conference Thursday.
Pernia attributed the country’s strong economic performance during the quarter to sustained strong growth in exports and improvements in public spending, which boosted the manufacturing subsector and the services sector.
“We are now seeing a sustained improvement in government spending in a run-up to our massive infrastructure program–the Build, Build, Build–which will continually unfold in the months ahead. This is expected to ramp up public spending even further,” he said.
Pernia expects construction activities and public spending making a headway in line with the government’s aim to spend 5.3 percent of GDP this year for infrastructure and up to 7.4 percent by 2022.
Pernia, also National Economic and Development Authority (NEDA) Director-General, said a weak peso benefited exports and remittances.
“It (weak peso) could be one of the main factors that affected exports, including the performance of the world economy as a whole. Our export markets’ performance has been better than expected,” he noted.
The Philippine Statistics Office (PSA) reported that the services sector was the largest contributor to the economic growth in the third quarter with a share of 4.2 percent, followed by industry at 2.5 percent and agriculture, 0.2 percent.
The industry sector, however, recorded the fastest growth of 7.5 percent followed by services with 7.1-percent growth. Agriculture slowed down by 2.5 percent from 3.0-percent in the previous year.
“There were some weather disturbances that occurred (in the third quarter) and it was mostly also accounted for by poor corn production. (The decline was) not agriculture as a whole but the corn item. Fishing and corn were the ones that went down,” he added.
Pernia is optimistic that fourth-quarter GDP will likely be higher or match the third-quarter economic performance.
“We expect a pick-up in household consumption in the last quarter of the year due to the holiday season,” he said. “So, imagine if both public and private spending are both on a roll. We are likely to see the economy steadily going on an upward trajectory.”