Philippines Annual GDP Growth Beats Forecasts in Q2


The Philippines economy grew an annual 6.5 percent in the June quarter of 2017, following a 6.4 percent expansion in the previous quarter and above market consensus of a 6.2 percent growth. Private consumption and government spending both grew at a faster pace, while investment and exports slowed.

In the three months to June, household consumption expanded 5.9 percent year-on-year, compared to a 5.8 percent increase in the first quarter. Government expenditure jumped 7.1 percent, faster than a 0.1 percent growth in the March quarter.
 
Gross domestic capital formation increased by 8.7 percent, slowing from a 10.6 percent growth in the previous quarter, and marking for first time single digit growth after eight straight quarters of double-digit gains. Investment in durable equipment grew by 8.7 percent, followed by construction (7.3 percent), breeding stocks & orchard development (4.5 percent) and intellectual property products (68.3 percent).
 
Exports increased by 19.7 percent, slower than a 20.3 percent rise in the first quarter. Sales of goods rose 23 percent (from 22.8 percent in the first quarter) and those of  services went up 9.9 percent (from 12.4 percent). Imports increased by 18.7 percent, following a 18.6 percent rise in the preceding quarter.
 
On the production side, the services sector advanced 6.1 percent, compared to a 6.7 percent growth in the three months to March. Growth in the sector was supported by public administration & defense; compulsory social security (7.6 percent), real estate (7.9 percent), trade and repair of motor vehicles, motorcycles, personal and household goods (6.3 percent), other services (5.0 percent), transport, storage & communication (3.5 percent) and financial intermediation (6.1 percent). The industry sector expanded 7.3 percent, following a 6.3 percent growth in the preceding quarter. Mining & quarrying rebounded by 13.7 percent, following a 18 percent fall in the March quarter. Manufacturing grew (7.9 percent), followed by construction (6.3 percent), and electricity, gas and water supply (2.4 percent). Agriculture, hunting, forestry and fishing rose 6.3 percent following a 4.9 percent expansion in the previous period.
 
For 2017, the economy is expected to advance between 6.5 to 7.5 percent, from 6.9 percent in 2016.
 
The International Monetary Fund trimmed its 2017 growth forecast for the Philippines to 6.6 percent from 6.8 percent, but was optimistic the economy would grow strongly in the medium term.
 
On a quarter-on-quarter seasonally adjusted basis, the GDP advanced 1.7 percent, compared to an upwardly revised 1.3 percent growth in the March quarter and above market consensus of 1.6 percent.
  
 

Philippines Annual GDP Growth Beats Forecasts in Q2


PSA l Chusnul Ch Manan | chusnul@tradingeconomics.com
8/17/2017 2:07:14 PM