PHILIPPINES RECORDS SIZZLING GROWTH PACE
GDP rises 6.5pc on construction boom and farm-sector rebound
THE Philippine economy grew at a sizzling pace in the second quarter, topping expectations as a government-led construction boom and an extended rebound in the farm sector took some of the sting off a peso currency wallowing at 11-year lows.
The Southeast Asian nation is the second-fastest growing economy in Asia after China, though some analysts cautioned that activity could wane if foreign investors were scared off by President Rodrigo Duterte’s deadly war on drugs.
Gross domestic product rose 6.5 per cent in the second quarter from a year earlier, said the national statistics agency, picking up from the 6.4 per cent pace in the first quarter, and above the 6.2 per cent forecast in a Reuters poll.
Quarter-on-quarter growth, at 1.7 per cent, also topped the 1.6 per cent pace projected in a Reuters poll, and faster than the previous quarter’s upwardly revised 1.3 per cent.
“We are well on track to meeting our full-year target growth of 6.5 to 7.5 per cent,” said Economic Planning Secretary Ernesto Pernia.
Like its regional peers, the Philippines has benefited from an improvement in global demand, with exports up nearly 14 per cent in the six months to June.
Household consumption grew at slightly faster annual pace of 5.9 per cent in the second quarter compared with 5.8 per cent in the first, while government spending jumped 7.1 per cent in a dramatic rise from the revised 0.1 per cent gain in the March quarter.
“The sequential increase implies the economy is gaining momentum,” said ANZ economist Eugenia Fabon Victorino.
Indeed, Manila aims to lift growth to as much as eight per cent during Duterte’s term through a six-year, US$180 billion (RM772.2 billion) “Build, Build, Build” infrastructure programme.
All the same, the outlook is not without risks, according to Capital Economics senior economist Gareth Leather, who said Duterte’s controversial war on drugs had started to undermine investor sentiment. Reuters