GDP seen to grow by 4.9% in 3rd quarter
Philippine domestic output may have grown by 4.9 percent in the third quarter from that of the previous quarter, as the economy is seen to remain “relatively strong” despite the decline in exports.
The DBS Group said in a research note that the country’s gross domestic product was on track to meet its 2011 growth target of 4.6 percent.
But the financial service group also said that growth in 2012 could be weaker than its initial forecast of 5.2 percent due to lingering export woes.
“Export growth dropped to a 29-month low of -27.4 percent year-on-year in September, following a 13.7-percent contraction in (August),” DBS said. “This implies that total export growth for the year may be flat or even negative.”
Even then, the Singapore-based group said prices could have affected these numbers as the volume of exports reportedly grew by an average of 23 percent year-on-year, according to available data covering the months of July and August.
“In nominal value terms, electronics exports were the hardest hit, [but] the export volume of electronics … was actually higher in July and August compared to a year ago,” DBS said. “This suggests that overall GDP may not be as bad as the headline export numbers are suggesting.”
The group also cited other indicators, suggesting that the economy is relatively strong.
For one, the National Statistical Coordination Board reported that the composite leading economic indicator continued to improve. The agency is referring to a set of data that is used for economic forecasting.
DBS also noted growth in bank lending, which reached 24.8 percent year-on-year in August. Data also show that the growth in loans has been around 2 percent month-on-month since April, or double the corresponding rate observed in the first half of 2010.
“[Also], remittance growth also been healthy despite external headwinds, rising by an average of 8.6 percent year-on-year in the three months ending September,” the group added.
DBS said that, in light of these indicators, which pointed to a relatively strong domestic economy, it would maintain its growth forecast for this year.
