The National Economic and Development Authority (NEDA) predicted that economic growth would improve in the third quarter because of robust consumer spending and a healthier retail sector.
In a statement on Saturday, Dennis Arroyo, director of the authority’s national planning and policy staff, said economic growth in the “third quarter of this year would be better than the second quarter.” Consumer spending in the coming months was seen to rise because of continued inflow of remittances with overseas Filipino workers (OFWs) returning to work abroad, he added.
Arroyo said that the economy was set to get a boost from the increase in retail trade beginning in December, earnings in tourism and spending from the Business Process Outsourcing (BPO) industry workers.
“The improvement in the second quarter personal consumption to 2.2-percent growth rate compared to the last quarter seems to indicate the easing of the fear in consumers,” he added.
Target attainable
Arroyo said that it was “possible to breach the high-end of the government target given the signs of an economic turnaround such as the growth in Philippine exports, the rise of the stock market, and the slowdown in inflation.”
The government expects the gross domestic product (GDP) to grow between 0.8 percent and 1.8 percent this year. A key economic indicator, GDP is the total amount of final goods and services produced in a country in a year.
In the second quarter, the economy grew 1.5 percent compared to the 4.2-percent growth in the same period last year.
The second-quarter GDP performance was an improvement from the 0.59 percent economic growth in the first quarter. It also exceeded the government’s forecast of between negative 0.1 percent and 0.9 percent for the period.
On a seasonally adjusted quarter-to-quarter basis, the economy turned around to post 2.4-percent growth from the 2.1-percent contraction in the first quarter of the year.
Romulo Virola, secretary general of the National Statistical Coordination Board, said the quarter-to-quarter growth effectively spared the Philippines from a recession, which had appeared likely when the economic growth rate declined by 2.1 percent in the first quarter.
Also, the gross national product (GNP) rose 4.4 percent in the second quarter. But that figure was lower that the 5.3 percent posted in the same period last year. GNP, another economic indicator, it the total value of goods and services produced by all Filipinos here and abroad. –Darwin G. Amojelar, Senior Reporter, Manila Times
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