The Philippine economy may have matched or expanded in the third quarter at a slightly faster pace than the previous quarter amid lower inflation, according to the Department of Economy, Planning and Development (DEPDev).
‘Overall, I think we should see, if not at the same pace, it’s slightly better,’ DEPDev Secretary Arsenio Balisacan told The STAR when asked how the economy likely performed in the third quarter compared to the previous quarter.
The economy grew by 5.5 percent in the second quarter, slightly faster than the 5.4 percent expansion in the first quarter, but slower than the 6.5 percent growth in the second quarter last year.
This brought average growth in the first half to 5.4 percent, lower than the government’s growth target of 5.5 to 6.5 percent for this year.
‘On the positive side, you have inflation coming down,’ Balisacan said.
While headline inflation quickened to 1.5 percent in August from 0.9 percent in July, it was slower than the 3.3 percent print in the same month last year.
Average inflation from January to August was also at 1.7 percent, below the government’s two to four percent target range for the year.
Despite the storms that hit the country, Balisacan said the agricultural damage is not extensive, except for some crops, such as vegetables.
He is also optimistic about seeing improvements in the labor market data in August.
Data from the Philippine Statistics Authority (PSA) showed that the country’s unemployment rate rose to 5.3 percent in July from 3.7 percent in June and 4.7 percent in the same month last year.
This also marked the highest jobless rate since it hit the same level in August 2022.
‘I believe the numbers for August should be better,’ Balisacan said.
He said the growth in the country’s exports, as exporters frontloaded shipments to the United States to avoid the 19 percent tariff that took effect on Aug. 7, should also be a positive factor.
Philippine export sales rose by 13 percent to $55.7 billion from January to August, compared to $49.45 billion in the same period last year.
‘I think the fourth quarter is what we need to work on harder,’ Balisacan said, noting that recently exposed flood control corruption issues are expected to have an impact on growth.
He said infrastructure spending, in particular, might be affected by the scandal.
‘We have to manage that from our end and ensure that those infrastructure projects and programs that are not tainted with corruption should be able to move,’ he said.
Given domestic challenges and risks from external developments, Balisacan said he ‘would be happy if we get 5.6, 5.7 (percent growth) for the whole year.’
The PSA is scheduled to report on the country’s third quarter economic performance on Nov. 7.