2016 Q3 GDP revised downward

Growth in the country’s gross domestic product (GDP) for the third quarter of 2016 was revised downward to seven percent from the 7.1 percent announced in November, the Philippine Statistics Authority (PSA) said yesterday.

Also revised downwards were the gross national incomes and net primary income from the rest of the world to 6.2- and 2.3- percent, respectively. The numbers are lower than the corresponding preliminary growth figures of 6.3- and 2.5-percent.

“The PSA revises the GDP estimates based on an approved revision policy which is consistent with international standard practices on national accounts revisions,” said the state statistics agency.

Economic output in the third quarter was boosted by the positive growth of 2.9 percent in the agricultural sector after five consecutive quarters of decline as farm output recovered from the prolonged dry spell brought about by the El Niño phenomenon that distressed the crops and fisheries subsectors.

Growth in the industry sector accelerated to 8.6 percent compared with 6.1 percent in the same period last year due largely to gains in manufacturing and construction.

The services sector, meanwhile, grew at a slower “but still reasonable” pace of 6.9 percent in the third quarter from 7.2 last year.

The economy grew by an average of seven percent in the first nine months of 2016, faster than most Asian economies.

PSA is scheduled to announce the fourth quarter and 2016 economic performance today (Jan. 26). The government expects the economy to have grown at a rate of between 6.8 percent to 7.1 percent in the fourth quarter of the year and by six to seven percent in 2016.

Full year growth in 2016 is expected to have been supported by strong household consumption as well as investments in construction, public infrastructure and durable equipment.

This, in turn, was encouraged by low inflation, low interest rates, improved labor market conditions and steady growth in remittances of overseas Filipino workers.

Government assistance such as the Pantawid Pamilyang Pilipino Program is also seen to provide an additional boost to consumer demand.

From the supply side, the agriculture sector is beginning to recover, finally breaking five consecutive quarters of decline. Growth in the industry and services sectors are also expected to be sustained. In particular, bright spots are manufacturing, construction and utilities, trade, finance, real estate and public administration.

In 2017, NEDA expects growth of 6.5- to 7.5-percent and seven to eight percent beyond 2017.