Philippines GDP Growth Beats Expectations in Q3


The Philippines economy grew an annual 7.1 percent in the September quarter of 2016, following a 7.0 percent expansion in the second quarter and beating market consensus of a 6.7 percent growth. It was the strongest expansion since the June quarter 2013, mainly supported by strong private consumption while government spending, investment and exports eased.

In the three months to September, household consumption expanded 7.3 percent year-on-year, compared to a 7.4 percent increase in the second quarter. Government expenditure advanced 3.1 percent, easing  significantly from a 13.5 percent growth in the previous three months, as programs and projects were evaluated relative to the plans and policies of the new administration of President Rodrigo Duterte, who began a six-year term at the end of June. Gross domestic capital formation increased by 20.0 percent, compared to a 25.0 percent growth in the previous quarter, supported by construction: +16.8 percent, durable equipment: +29.6 percent, breeding stocks & orchard development:+3.4 percent and intellectual property products:+29.2 percent.

Exports grew by 8.8 percent, slower than a 10.0 percent rise in the June quarter. While sales of goods rose 7.8 percent (from +7.2 percent in the second quarter), those of  services went up 14.2 percent (from +19.5 percent). Imports increased by 14.2 percent, following a 23.3 percent in the preceding quarter.

On the production side, the services sector advanced by 6.9 percent, compared to a 8.3 percent growth in the second quarter and accounted for a 49.1 percent of the total economy. Growth in the sector was supported by real estate (+8.8 percent), financial intermediation (+8.1 percent), other services (+7.0 percent), trade and repair of motor vehicles, motorcycles, personal and household goods (+6.5 percent), transport, storage & communication (+4.9 percent) and public administration & defense; compulsory social security (+3.7 percent). The industry sector expanded 8.6 percent, following a 7.1 percent growth in the preceding quarter. Construction recorded the highest increase (+15.5 percent), followed by electricity, gas and water supply (+9.5 percent) and manufacturing (+6.9 percent). In contrast, mining & quarrying shrank by 0.4 percent, following a 7.1 percent rise in the June quarter. Agriculture, hunting, forestry and fishing grew by 2.9 percent, rebounding from a 2.0 percent contraction in the previous period. 

For the first nine months of 2016, the economy expanded 7.0 percent, faster than a 5.7 percent growth in the same period a year earlier.

For 2016, the economy is expected to grow between 6.0 to 7.0 percent.

On a quarter-on-quarter seasonally adjusted basis, the GDP advanced 1.2 percent, slowing from an upwardly revised 2.1 percent expansion in the three months to June but slightly higher than estimates of a 1.1 percent growth. 

Philippines GDP Growth Beats Expectations in Q3


PSA l Rida Husna | rida@tradingeconomics.com
11/17/2016 4:31:47 AM