The Philippine economy grew “remarkably” in 2013, with the gross domestic product (GDP) for the entire year hitting 7.2 percent, the Philippine Statistics Authority (PSA) and Socioeconomic Planning Secretary Arsenio Balisacan reported Thursday.
The GDP outpaced the 6.8 percent posted in 2012, Balisacan said.
The 7.2 percent was the fastest since President Benigno Aquino 3rd came to power in 2010 and exceeding the government target of 6.0-7.0 percent.
The fourth-quarter GDP was 6.5 percent, down from 7.1 percent in the same period the year before. Balisacan attributed the drop to damage left by Typhoon Yolanda in November.
“The economy grew better than our expected target of 6 percent to 7 percent for 2013 despite the challenges we faced during the year, particularly the disasters that struck Central and Southern Philippines in the fourth quarter,” he said.
If the country sustains a 7-percent GDP in the next eight years, the economy is expected to double.
Balisacan, who is director general of the National Economic and Development Authority (NEDA), said the fourth quarter growth would have hit 7 percent to 7.3 percent were it not for Yolanda and other calamities the country suffered.
“Nonetheless, the Philippines remains as one of the best performing economies in the Asian region in the fourth quarter of 2013, second only to China, which grew by 7.7 percent,” he said.
Balisacan said construction and government spending had the “highest setback,” slipping by 0.8 percent and 5.2 percent.
The Aquino administration is expecting the momentum of growth to continue this year, Presidential Communications Secretary Herminio Coloma Jr. said Thursday.
Coloma said the government remains focused on achieving “inclusive growth” by reducing poverty and increasing social protection.
He said the updated Philippine Development Plan “emphasizes the spatial or area-specific dimensions of development.”
“Hence, government spending is directed at increasing the productivity and reducing the vulnerability of farmers, fisherfolk, and other marginalized sectors,” he said.
Coloma said the government wants to boost employment opportunities so that the vast potential of the country’s highly talented workforce could be fully harnessed.
The government said the main drivers of growth were in the manufacturing, trade, real estate and finance sectors, while hailing the performance as further proof of Aquino’s economic stewardship.
“We were expecting that somehow, given what happened in November (with Yolanda), it could really pull growth down,” Astro del Castillo, an analyst with local investment management firm First Grade Finance, told Agence France-Presse. “But the other sectors were quite strong, particularly manufacturing and services.”
The manufacturing sector expanded by 12.3 percent in the final quarter of the year, more than twice as fast as the same period of 2012, partly due to growing exports, according to official data.
Exports of services was another key growth area, up 7.0 percent in the final quarter, as the business process outsourcing (BPO) industry dominated by call center operators continued to boom.
Balisacan said Yolanda’s impact would continue to drag on the Philippine economy in the first quarter of 2014, as millions of survivors in typhoon-affected areas struggled to rebuild their homes, businesses, farms and fishing boats.
“But we are optimistic that the Philippine economy will remain strong in 2014, especially . . . (because) the outlook on the global economy is becoming more favorable and as the domestic economy remains robust,” he said.
Finance Secretary Cesar Purisima described last year’s economic performance as “astounding”, pointing out that the final quarter was the eighth consecutive three-month period of growth exceeding 6.0 percent.
“This growth demonstrates the resilience of the country,” he said. “The Philippines continues to be the second-fastest growing economy in Asia, after China, with its strengthening BPO and tourism sectors.”
Krystal Tan, a regional economist with research group Capital Economics, also described the Philippine economy as having proved “remarkably resilient” to Yolanda.
She said the vast amount of money being spent on the reconstruction effort would help spur the economy in 2014, and forecast full-year growth of 6.5 percent.
University of Santo Tomas economist Alvin Ang agreed that the growth was driven by the robust manufacturing sector and strong public spending.
“Growth drivers of the economy are manufacturing plus strong public expenditure due to Typhoon Yolanda rebuilding. [GDP is likely to reach] 7 percent for 2014,” Ang told The Manila Times in a text message
With Catherine S. Valente and AFP