Philippines Posts Strong GDP Growth in Q4


The Philippines economy grew an annual 6.3 percent in the December quarter of 2015, accelerating from an upwardly revised 6.1 percent expansion in the previous three months and above market consensus. It is the highest growth since the fourth quarter of last year, as all of the components showed an expansion.

In the fourth quarter, household spending, investment and exports expanded at a faster rate while government expenditure remained robust.

Household consumption grew by 6.4 percent year-on-year, as compared to a 6.1 percent increase in the September quarter 2015. Gross domestic capital formation increased by 13.5 percent, accelerating from a 12.4 percent growth in the previous quarter, as investment  expanded for all categories. Investment on durable equipment rose 40.2 percent year-on-year, followed by construction (+7.8 percent), breeding stocks & orchard development (+2.5 percent) and intellectual property products (+9.4 percent). 

Exports expanded by 7.1 percent, faster than a 6.4 percent growth in the third quarter, as sales of goods rose 1.7 percent and those of  services surged by 30.2 percent. Imports rose by 13.3 percent, as compared to a 14.9 percent increase in the June quarter. Among goods, sales of ignition wiring sets rose the most by 36.6 percent, followed by electronic components (+14.3 percent). Growth in exports of services were contributed by travel (+58.9 percent), transportation (+34.3 percent), miscellaneous services (+23.8 percent) and government (+11.1 percent).

Government expenditure grew by 17.4 percent, the same pace as in the preceding quarter, supported by strong disbursement of major government expenditures and other operating expenses. 

On the production side, services sector expanded the most by 7.4 percent, following a 7.2 percent in the June quarter. Growth in the sector were contributed by: transportation, storage and communication (+8.9 percent), trade and repair of motor vehicles, motorcycles, personal and household goods (+7.0 percent), financial intermediation (+7.4 percent), real estate, renting & business activity (+7.9 percent) and other services (+8.1 percent). The industry sector rose 6.8 percent, as compared to a 5.5 percent growth in the previous period. Construction grew the most by 8.4 percent, followed by mining & quarrying  (+7.8 percent), manufacturing (+6.6 percent) and electricity, gas and water supply (+4.8 percent). In contrast, agriculture, hunting, forestry and fishing contracted by 0.3 percentm following a 0.3 percent expansion in the September quarter.

For 2015, the economy grew by 5.8 percent, slowing from a 6.1 percent expansion in 2014. The administration of President Benigno Aquino, which started in 2010 and will end on June 30, averaged 6.2 percent growth, the best rate since the 1970s.

On a quarter-on-quarter seasonally adjusted basis, the GDP advanced 2.0 percent in the fourth quarter of 2015, accelerating from an upwardly revised 1.4 percent expansion in the  quarter. The expansion was mainly driven by a rebound in agriculture sector and a faster increase in industry while services sector slowed.

Philippines Posts Strong GDP Growth in Q4


PSA l Rida Husna | rida@tradingeconomics.com
1/28/2016 7:23:32 AM