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Philippines surprises with 7.1% GDP growth in Q3; more jobs, better incomes seen

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The Coastal Road from the Pasay end of Roxas Boulevard to Cavite province is upgraded in this photo taken on May 13, 2012. The Philippines beat expectations in the third quarter with 7.1 percent growth in terms of gross domestic product, ahead of other economies within Association of Southeast Asian Nations. PHOTO BY RICK ALBERTO

MANILA, Philippines—The Philippines beat expectations in the third quarter with 7.1 percent growth in terms of gross domestic product (GDP), ahead of other economies within Association of Southeast Asian Nations. The country’s top economist said this would translate to more jobs and better incomes for Filipinos.

The third-quarter performance of the Philippines was way above the market’s media forecast of 5.4 percent, Socioeconomic Planning Secretary Arsenio Balisacan said. Indonesia was the second-best performer in the Asean with 6.2 percent growth, followed by Malaysia (5.2 percent), Vietnam (4.7 percent), Thailand (3 percent), and Singapore (0.3 percent). On the other hand, China registered a 7.7-percent GDP growth in the same period.

Balisacan said he expected economic growth momentum to continue in 2013 as government has been working to ease the cost of doing business and as more infrastructure projects go into construction, spurring dollar inflows that might help ease the strengthening peso.

Year-to-date growth is already at 6.5 percent with services and industry (except mining) still driving growth. Officials said this meant that full-year growth would likely beat the target of 5 to 6 percent and move towards the previously “aspirational” 7 to 8 percent range needed per year to spur employment and curb poverty.

A strong BPO (business process outsourcing) sector, booming construction, increased consumer and government spending, and external trade contributed to the highest quarterly growth since the third quarter of 2010, National Statistical Coordination Board (NSCB) Secretary-General Jose Ramon G. Albert said.

Relatively stable prices, steady inflow of remittances, and rebounding exports supported growth, according to the National Economic and Development Authority (NEDA). While export receipts of semiconductors and electronic data processing equipment contracted, both items contributed recently to increased imports, which might mean that manufacturers have been “stocking up” on intermediate inputs in anticipation of recovery in the global demand for electronic products, NEDA said.

Property development due to growing demand for homes and office spaces (mostly due to a strong BPO outlook) helped push development, NEDA said, as did public road and irrigation projects. “Most of these (government) projects were implemented outside NCR, in keeping with our objective of inclusive growth,” Balisacan said.

Agriculture also fared better in the third quarter than in the four previous quarters with increased rice and corn outputs as part of efforts for food self-sufficiency. The weak fishery sector has become a concern, however, Balisacan said.

Trade Secretary Gregory Domingo said in a phone interview that he was “not surprised” with the 7.1 percent growth for the third quarter because the country was coming from low growth base. In the third quarter of 2011, the economy turned sluggish as exporters and other contributors to the economy felt the impact of the triple tragedy in Japan and the flooding in Thailand earlier that year.

“Nevertheless it is good to post this level of growth for the third quarter. We will continue to help our business people with shared facilities, simplifying and shortening the process of starting a business, and educate entrepreneurs as well as students on how to take advantage of free-trade agreements.

The Makati Business Club (MBC) lauded the strong third-quarter performance. “MBC and the larger business community welcome yet another positive development for the Philippine economy despite continuing global challenges. Good governance is paying off. President Aquino and his economic team must be lauded,” MBC executive director Peter Perfecto said via text message.


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Tags: Arsenio Balisacan , Business , economic growth , Gross Domestic Product , incomes , jobs , National Economic and Development Authority , Philippine economy , Philippine government

  • http://profile.yahoo.com/GHH2IPW7ZSTQX4JCYQWL2BLXOE MarcialA

    there are 10 million ofw.say the average salary is 700 dollar a month, thats 7 billion dollar a month where this  remittance go.if government regulate money changer all remittance will go to national reserve

  • EdgarEdgar

    After the initial ecstasy and revelry, the hollow triumphalism of Aquinomics proved to be shortlived. Even Trade Secretary Gregory Domingo, admitted off the cuff that the seemingly higher GDP figure for Q3 is entirely attributable to the fact that 2011 saw a dismal growth rate. In fairness to the Trade Secretary, he refused to participate in overplaying last quarter’s GDP. ADB likewise criticized the current administration for not spending enough in 2011 thereby stunting economic growth. Coming from such a low base last year, the public is thus easily led to believe that things today are rosier than rosy, the sky bluer than blue, the glass fuller than half full, and therefore all Filipinos must be happier than happy.

    Credit must also go to the current NEDA Chief Balisacan who clearly knows how to play ball and play up the numbers. Now it can be said that the former NEDA chief Paderanga had to leave government because he clearly lacked the social skills to please the president at whose pleasure he serves. Fudging and flattering were never Padaranga’s strong suit. He is much more at home now and much happier in the academe than he ever was in the government. And as if by some well-calculated coincidence, the departure of Paderanga ushered in a quarter of fantastically spectacular growth under his successor’s watch. 

    If Q3 indeed benefited largely from growth in public construction, the more we ought to be vigilant as roads and irrigation projects are lucrative sources of corruption. More so with the upcoming May 2013 elections. And if Q3 indeed benefited just as much from growth in private construction, banks and lending institutions ought to be more mindful of oversupply and possibly bad loans.

    All told, the irrational exuberance was fun while it lasted.  

    • Hendot2012

       Crab

      • EdgarEdgar

        Crab? Reminds me of Noynoy who walks like a crab.

      • Hendot2012

        Joke yun?

    • pinoypower

      You’re trying to imply that the NEDA figure is unreal and even hyped up. If that’s the case how come the market reactive positively, pushing the peso and the PSE index to all time high? The investors in the stock market include international players who are financial experts. You can’t fool them with a doctored economic figure because they have economists of their own who track vital financial informations all over the world.
      Get real. How could you talk of the “irrational exuberance” in the past tense and already lasted when the news about the 3rd quarter figure is just trickling in.

      • EdgarEdgar

        that’s because the stock market may perform well despite weak macro. fudged? the low base from last year is being obscured by current NEDA chief to mislead the public. if you know how to read, you probably came across Trade Secretary’s donwplaying of the Q3 GDP. finally, feel free to rewrite the last bit in present or future perfect tense.

  • http://twitter.com/PINOYPOWER100 JUAN DELA CRUZ

    Iba talaga kapag hindi corrupt ang presidente. God speed PNoy.

  • Ronald Diaz

    Let us continue work harder for our better economy.. jail the corrup? politicians and gov’t officials.

  • http://profiles.yahoo.com/u/LSC6LC55H5VT4O7223VVC7XD7A Maurice

    Important To-Do-List:

    RH Bill (OUR FUTURE)
    Sin Tax Bill (OUR CREDIT RATING)
    Pushing PPP (OUR INFRASTRUCTURE)
    Achieving Category 1 Aviation Savety Status (OUR TOURISM)



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