Economic expansion eases sans lockdown base effect
MANILA -The Philippine gross domestic product (GDP) grew better than expected at 6.4 percent in the first quarter this year, which the country’s chief economic planner said meant that the economy was back on a high-growth path.
National Statistician Dennis Mapa said in a press briefing the January to March growth rate was the slowest in the past seven quarters or since the second quarter of 2021 when Philippines emerged from recession with an expansion of 12 percent.
On the other hand, the first-quarter readout is better than the private sector economists’ median forecast of 6.2 percent.
Still, the results for the first three months of this year were in line with forecasts that the global economy as a whole will grow slower in 2023 than it did last year.
For comparison, the Philippine economy grew by 7.1 percent in the previous or fourth quarter of 2022, and by 8 percent in the first quarter last year.
Secretary Arsenio Balisacan of the National Economic and Development Authority raised caution about interpreting the first-quarter results as a slowdown, saying that the 8 percent growth in the same period of 2022 came from a low base.
Strong 2022 was easy
Balisacan meant that achieving high growth in early 2022 was relatively easy because output was low in early 2021 when COVID-19 measures hampered economic activities.
“Rather, the economy is normalizing its previous trend,” Balisacan said. “The better-than-expected first-quarter performance this year implies that we are returning to our high-growth trajectory despite the various challenges and headwinds we have faced.
Even then, he said there was much more work to do in order to realize the social and economic transformation agenda toward a prosperous, inclusive and resilient Philippines.
Balisacan said that despite a rather auspicious beginning for 2023, the Marcos administration has to remain vigilant and stand ready to ensure that the domestic economy not only go back to its high-growth path, but to achieve significant social and economic transformation by 2028.
Higher productivity
He said this involved developing and protecting the skills of Filipinos and improving the production sectors to create more quality jobs and competitive products, while ensuring a conducive overall investment environment in terms of governance and government policies.
In pursuing this, “it is crucial to address the rising costs of food and energy, especially since these disproportionately adversely affect the welfare of low-income and vulnerable individuals, as food items tend to dominate their consumption patterns,” he added.
According to Mapa, the main contributors to the first-quarter growth were the industries of wholesale and retail trade which grew by 7 percent; financial and insurance activities (8.8 percent); and “other services” (36.5 percent).
The National Statistician said that all three major economic sectors posted growth—industry (3.9 percent), services (8.4 percent); and agriculture, forestry and fishing (2.2 percent).
Mapa said that, on the other hand, contributors to the slower GDP growth were mining and quarrying which contracted by 2.2 percent as well as public administration and defense, and human health and social work activities which grew at slower rates.
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