“Due to the lower than expected growth momentum in 1H 2015 (5.3%), growth for 2015 is forecasted at 5.5% and 2016 growth is forecasted at 6.0%”.
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Government spending was a drag, with a 3.9 percent increase, though that was better than the 1.7 percent in the first quarter. The second-quarter growth was in line with what the market had expected but was slower than the 6.7% rate logged a year ago.
Growth in Philippine gross domestic product (GDP) in the first quarter of this year was slower than previously reported, according to revised official figures showing a 5.0 percent rise, instead of 5.2 percent.
“Realistically, achieving even the low end [of the target] now is very much a challenge”, said Economic Planning Secretary Arsenio Balisacan. Industry rose 6.1 percent while investment grew 8.9 percent.
However, public construction expanded 20.7 percent, from a 24 percent drop in the first. “This is a result of government’s efforts to address issues on spending bottlenecks, especially for public infrastructure, which held back growth in the first quarter”.
This contributed negative 0.35 percentage point to the downward revision of gross national iincome from 4.7% to 4.2%.
“The second-quarter GDP growth shows the expanse of the country’s resiliency from the prevailing weakness of the global economy”, Balisacan told a briefing.
“The government stepped up spending and private consumption also remains fairly strong”, Gundy Cahyadi, Singapore-based economist at DBS Group Holdings Ltd, said before the report.
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“We have to continue improving the absorptive capacity of government to spend available resources well and to efficiently implement crucial programs and projects throughout the country”. He added that any depreciation in its peso currency, as long as it wasn’t too sharp, should have a positive effect on the economy overall.
