PH econ­omy now be­com­ing more in­vest­ment-led — DOF

Manila Bulletin - - Business News - By CHINO S. LEYCO

The De­part­ment of Fi­nance (DOF) said yes­ter­day that the Philip­pine econ­omy is be­com­ing more in­vest­ment-driv­ing, not­ing this should sus­tain the coun­try’s rapid ex­pan­sion pace in the medi­umterm.

De­spite the slower gross do­mes­tic prod­uct (GDP) in the third-quar­ter, Fi­nance Un­der­sec­re­tary Gil S. Bel­tran, be­lieves the 6.1 per­cent eco­nomic growth is still “ro­bust.”

Bel­tran said that in­vest­ment boosted the growth af­ter its share to GDP rose to a record 26 per­cent in the first nine-months of the year from 23.6 per­cent in the same pe­riod in 2017. “This will sus­tain rapid eco­nomic growth over the medium-term,” Bel­tran said in his lat­est eco­nomic bul­letin sub­mit­ted to Fi­nance Sec­re­tary Car­los G. Dominguez III.

In­vest­ment also posted a dou­ble-digit growth at 16.7 per­cent, while con­struc­tion jumped by 16.1 per­cent due to pub­lic con­struc­tion’s 25.4 per­cent in­crease and pri­vate con­struc­tion’s 12.1 per­cent.

Bel­tran also said that steady ser­vices sec­tor, which grew by 6.9 per­cent, due to pub­lic ad­min­is­tra­tion, de­fense, fi­nan­cial in­ter­me­di­a­tion, and other ser­vices, sup­ported the coun­try’s growth this year.

The fi­nance of­fi­cial, like­wise, cited that ex­ports grew 14.3 per­cent, de­spite global un­cer­tain­ties, as an­other rea­son for the above six per­cent GDP.

Bel­tran, mean­while, said that agri­cul­ture and man­u­fac­tur­ing dragged down the coun­try’s eco­nomic ex­pan­sion.

In the third-quar­ter, agri­cul­ture con­tracted by 0.4 per­cent, while food man­u­fac­tur­ing slowed to 2.6 per­cent from five per­cent, chem­i­cals de­clined 4.6 per­cent, and to­bacco and al­co­holic bev­er­ages fell 21.4 per­cent due to higher taxes.

“It [growth] was also ad­versely af­fected by ris­ing in­fla­tion drag­ging down house­hold con­sump­tion with de­clines in con­sump­tion of food and non­al­co­holic bev­er­ages, to­bacco and al­co­holic bev­er­ages, and trans­port,” Bel­tran said.

“The lat­ter was due to the rise in the price of pe­tro­leum in the world mar­ket due to Iran sanc­tions,” he added.

To avert eco­nomic slow­down and sus­tain rapid growth, Bel­tran said the gov­ern­ment should sus­tain its fis­cal space through the pas­sage of re­main­ing tax re­forms to main­tain in­vest­ment growth.

He also said the gov­ern­ment should work on damp­en­ing in­fla­tion­ary pres­sures through sup­ply-boost­ing mea­sures as well as im­ple­ment agri­cul­ture pro­duc­tiv­ity pro­grams.

The gov­ern­ment should also open im­ports of agri­cul­ture in­puts for man­u­fac­tur­ing, the fi­nance of­fi­cial said.

On Thurs­day, The Philip­pine Statis­tic Au­thor­ity (PSA) re­ported Philip­pine eco­nomic growth slightly weak­ened in the third-quar­ter amid sky­rock­et­ing com­mod­ity prices that were par­tially fu­elled by the con­trac­tion of the agri­cul­ture sec­tor dur­ing the three-month pe­riod.

But de­spite the slower eco­nomic ex­pan­sion, So­cioe­co­nomic Sec­re­tary Ernesto M. Per­nia be­lieves the thirdquar­ter GDP is a “re­spectable” per­for­mance, cit­ing it is the 14th con­sec­u­tive quar­ter where the coun­try grew above 6.0 per­cent.

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