GDP growth seen to swing back to 6-7% range in 3rd quarter

With the government catching up on spending its budget intended for public goods and services, the country’s chief economist on Thursday expressed optimism that economic growth would return to the target band in the third quarter.

On the sidelines of the state-run Philippine Institute for Development Studies’ (PIDS) Fifth Annual Public Policy Conference, Socioeconomic Planning Secretary Ernesto M. Pernia said “we’ll have a higher performance” in terms of gross domestic product (GDP) growth in the third quarter.

Pernia, who heads the state planning agency National Economic and Development Authority (Neda), said third-quarter GDP growth would be “higher than the first semester [figure],” which averaged 5.5 percent or below the 6-7 percent full-year growth goal.

The Neda chief said that besides the usual growth drivers, catching up on budget implementation augured well to boosting the economy in the third quarter.

Pernia said the economy could grow by 6 percent in the July to September period, adding that “we have to believe in ourselves.”

The attack on Saudi Arabia’s oil fields would also unlikely impact on growth even as Pernia had said it was a risk to inflation.

“Saudi [government] has said they will be back in business by the end of September. So it’s an ephemeral thing, short-lived,” Pernia said.

On Wednesday, Pernia warned that the easing inflation environment might be at risk in case global oil prices shoot up.

Based on the monitoring of industry group Laban Konsyumer Inc., Dubai crude prices eased to $62.32 per barrel on Thursday from Wednesday’s $66.90 a barrel.