Menu

Search

  |   Commentary

Menu

  |   Commentary

Search

Philippines looks set to miss growth target

The Philippines looks set to be the next Asia-Pacific economy to fail to meet its expected growth figure this year after new official data. The data, from the Philippine Statistics Authority, showed the economy expanded at an annual 5.6 per cent in the second quarter, bringing growth in the first six months to 5.3 per cent, down from 6.7 per cent for the same period a year ago. During the first quarter, the economy grew by 5 per cent.

Arsenio Balisacan, the economic planning secretary, said the government is now likely to miss its 2015 full-year growth target of 7 to 8 per cent, with 6 to 6.5 per cent growth looking more realistic.

In China, growth is expected to be about 6.8 per cent this year, against a government target of 7 per cent, while in July the Bank of Japan reduced its forecast for the country's expansion this year from 2 per cent to 1.7 per cent. Also in July, the International Monetary Fund (IMF) cut its overall growth forecast for Indonesia, Malaysia, the Philippines, Thailand and Vietnam, the so-called ASEAN Five, a reference to the Association of South-East Asian Nations.

In April, the IMF had been looking for 5.2 per cent growth in gross domestic product (GDP) this year and 5.3 per cent next year, but reduced those forecasts to 4.7 per cent and 5.1 per cent respectively.

Mr Balisacan called the second-quarter figure "respectable," saying it reflected increased government spending, especially in public construction, which grew 20 per cent from a 24 per cent contraction in the first quarter. Private investment, robust exports, and household consumption also contributed to growth.

"Despite the GDP number hitting slightly below the government's target, we recognise that it is much more important to ensure that the growth momentum is sustained," he said, adding that "the quality and the rate of current growth" will help the Philippine economy "withstand the volatile markets overseas".

As GDP growth was slower during the second quarter than in the same period last year, so the "internal" measure, gross national product (GNP), had expanded more sluggishly, according to Lisa Grace Bersales, national statistician for the Philippines. It grew by 5 per cent, down from 6.9 per cent.

She added: "For the first semester [half year] of 2015, GDP grew by 5.3 per cent from 6.2 per cent...in the first semester of 2014." GNP growth slowed to 4.6 per cent, from 6.7 per cent during the same period last year.

  • Market Data
Close

Welcome to EconoTimes

Sign up for daily updates for the most important
stories unfolding in the global economy.