Philip­pine growth at 1-Year high

The Pak Banker - - BUSINESS -

Philip­pine growth quick­ened to the fastest pace in a year af­ter the govern­ment took steps to ac­cel­er­ate dis­burse­ments and as con­sumer spend­ing strength­ened. Stocks pared losses.

Gross do­mes­tic prod­uct in­creased 6.3 per­cent in the three months through De­cem­ber from a year ear­lier, Philip­pine Sta­tis­tics Au­thor­ity said in Manila Thurs­day. That com­pares with a me­dian es­ti­mate of 5.9 per­cent in a Bloomberg sur­vey of 17 an­a­lysts, and a 6.1 per­cent pace in the third quar­ter. The econ­omy ex­panded 5.8 per­cent in 2015.

"In Asia, we ex­pect the Philip­pines to be among those who will out­per­form this year," said Eu­ge­nia Vic­torino, an econ­o­mist at Aus­tralia & New Zealand Bank­ing Group Ltd. in Sin­ga­pore.

"The do­mes­tic econ­omy is pro­vid­ing a healthy buf­fer against the global trade re­ces­sion we are see­ing and elec­tion spend­ing will help keep growth ro­bust."

Pres­i­dent Benigno Aquino, whose term ends in June, is step­ping up ef­forts to un­lock bot­tle­necks in state spend­ing and lure in­vest­ment. That's help­ing shield the na­tion amid an en­trenched China slow­down that's hurt other emerg­ing na­tions. The World Bank fore­cast the econ­omy will ex­pand more than 6 per­cent this year and through 2018, to re­main among the fastest in the world.

Stocks pared losses to 0.2 per­cent as of 11:07 a.m. in Manila, af­ter fall­ing as much as 0.9 per­cent ear­lier. The peso dropped 0.1 per­cent.

A 7 per­cent growth rate is achiev­able this year, out­go­ing Eco­nomic Plan­ning Sec­re­tary Arse­nio Bal­isacan said at a briefing Thurs­day.

The Philip­pines has strong fis­cal space and can con­tinue to in­vest in in­fra­struc­ture, Fi­nance Sec­re­tary Ce­sar Purisima said in an in­ter­view with Bloomberg Tele­vi­sion. The na­tion is well-po­si­tioned to with­stand tur­bu­lence caused by un­cer­tainty in the global land­scape, he said in a sep­a­rate state­ment.

Aquino is in­creas­ing spend­ing to a record this year. The cen­tral bank sees no need to ad­just pol­icy set­tings at the mo­ment, Gov­er­nor Amando Te­tangco said af­ter the re­port. Ex­ports con­tracted in nine of 11 months last year.

"Growth is strong, driven by do­mes­tic con­sump­tion and an ac­cel­er­a­tion in the govern­ment's in­fra­struc­ture spend­ing," Jeff Ng, a Sin­ga­pore­based econ­o­mist at Stan­dard Char­tered Plc, said be­fore the re­port. "There will be some ex­ter­nal head­winds this year, but the Philip­pines will still out­per­form due to its strong do­mes­tic driv­ers."

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