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Philippines GDP growth strongest in 2-1/2 years

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Staff writer ▼ | May 20, 2016
Philippines street
Asia   Household consumption expanded by 7.0 percent

The Philippines economy grew an annual 6.9 percent in the March quarter of 2016, accelerating from an upwardly revised 6.5 percent expansion in the previous three months.

In the first quarter, household consumption expanded by 7.0 percent year-on-year, as compared to a 6.5 percent increase in the December quarter 2015. Government expenditure rose 9.9 percent, slowing from a 15.8 percent growth in the previous three months.

Gross domestic capital formation increased by 23.8 percent, accelerating from a 13.3 percent growth in the previous quarter, as investment expanded for all categories.

Investment on durable equipment rose 36.6 percent year-on-year, followed by construction (+12.0 percent), breeding stocks & orchard development (+4.1 percent) and intellectual property products (+24.3 percent).

Exports expanded by 6.6 percent, slower than a 10.9 percent growth in the fourth quarter, as sales of goods eased (+5.2 percent from +9.0 percent +11.1 percent). Those of services also slowed (+ 11.1 percent from +19.1 percent). Imports grew by 16.2 percent, faster than a 14.9 percent in the December quarter.

On the production side, the services sector advanced by 7.9 percent, compared to a 7.8 percent growth in the December quarter, supported by financial intermediation (+9.1 percent), real estate (+9.0 percent), trade and repair of motor vehicles, motorcycles, personal and household goods (+8.0 percent), other services (+8.0 percent), public administration & defense; compulsory social security (+6.8 percent) and transportation, storage and communication (+5.4 percent).

The industry sector expanded 8.7 percent, following a 6.5 percent in the preceding quarter quarter.

Growth in the sector were contributed the most by mining & quarrying (+11.3 percent), followed by construction (+10.8 percent); electricity, gas and water supply (+9.7 percent) and manufacturing (+8.1 percent).

In contrast, agriculture, hunting, forestry and fishing contracted by 4.4 percent, following a 0.2 percent decline in the December quarter.

For 2016, the economy is targeted to grow by 6.8 to 7.8 percent.

The incoming administration of President-elect Rodrigo Duterte plans to achieve annual economic growth of 7.0 to 8.0 percent. On a quarter-on-quarter seasonally adjusted basis, the GDP advanced 1.1 percent in the first quarter of 2016, slowing from an upwardly revised 2.1 percent expansion in the December quarter 2015 and missing market estimates. It is the weakest growth since the June quarter 2015.


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