Socioeconomic Planning Secretary Arsenio Balisacan said that the country’s economy needs a growth of 2 percent to 5.7 percent to achieve the government’s gross domestic product (GDP) target for the current year.
Earlier, the interagency Development Budget Coordination Committee (DBCC) set a 6.5-percent to 7-percent growth target for the year. The first and second quarter GDP growth figures were 7.6 percent, and it was 7 percent for third quarter.
“This implies that the Philippine economy only needs to grow between 2 and 5.7 percent in the fourth quarter of 2013 in order to attain the DBCC growth target for the whole year,” Balisacan said.
According to Balisacan, who is also the National Economic and Development Authority (NEDA) director general, the 7-percent third quarter GDP growth was the fifth consecutive quarter where the country’s economy grew by not less than 7 percent, which was kept afloat by good macroeconomic factors.
“[The GDP growth was] buoyed by consumer spending, higher business and consumer confidence, favorable interests, stable inflation, strong inflows of overseas Filipinos remittances, high inbound tourism, and an optimistic domestic economic outlook,” he said.
“Needless to say, we need to remind ourselves that we need to work even harder to ensure that our gains are robust even as we face various threats and risks,” Balisacan added.
Though the GDP growth for first three quarters of the year presented excellent results, he said that the destructions brought by various calamities—Typhoons Santi and Yolanda, and the Cebu-Bohol earthquake—were “expected to shave off a part of growth in the fourth quarter,” and its negative effects may last depending on how fast relief and reconstruction operations are conducted in the affected areas.
“To date, NEDA estimates that the combined impact of these disasters could reduce the full-year 2013 real GDP growth rate by 0.5 percentage point. Thus, the recovery and reconstruction plan has to be systematically executed and managed well,” Balisacan said.
For the 7-percent GDP growth for the third quarter, the NEDA director general cited the rise of capital formation and investment in durable equipment as contributing to the improvement, which grew by double digits by 15.6 percent and 22.3 percent, respectively. This was fueled by sustained growth since the first quarter and higher demand for transport services, especially air transport.
On the supply side, Balisacan explained that intensified manufacturing supported the industrial sector’s growth—obtaining 9.7-percent growth in manufacturing because of the 135.2-percent growth contributed by chemical and chemical products.