Government officials Tuesday expressed confidence to hit growth targets this year as the country’s gross domestic product (GDP) grew 11.8 percent in the second quarter of the year, recovering from a 17- percent contraction last year.
National Statistician Dennis Mapa said the second quarter growth is the second highest growth of the Philippine economy on a quarterly basis, since the fourth quarter of 1988 when the economy grew 12 percent.
The economy churned in a value of P488.83 billion for the period, up from P370.35 billion in the second quarter of 2020, according to Mapa.
The net primary income from the rest of the world, however, contracted by 53.8 percent for the period, dragging the gross national income (GNI) to a 6.6 percent growth for the period.
On a per sector basis, the industry and services grew 20.8 percent and 9.6 percent, respectively, while the agriculture, forestry and fishing contracted by 0.1 percent.
Per capita GDP grew 10.3 percent, a reversal from last year’s 18.1 percent contraction, while per capita GNI grew 5.2 percent compared to an 18.8 percent contraction last year.
Household final consumption expenditure grew 5.8 percent, a reversal from the 16.5 percent contraction last year.
Socioeconomic Planning Secretary Karl Chua said the strong recovery for the period was driven by more than just “base effects” as the contraction recorded last year reset the growth momentum of the economy.
“It is the result of a better balance between addressing COVID-19 and the need to restore jobs and incomes of the people,” said Chua.
Citing the 75.5 percent increase in investment for the period, with private investments growing 94.9 percent, Chua said this indicates an “improvement in business confidence as the economy learns to live with the virus.”
“Our policy to allow both public and private construction even during the enhanced community quarantine (ECQ) period last March and April 2021 shows that we can revive the economy while addressing COVID-19 infections,” he said.
“Almost all sectors bounced back despite the imposition of the ECQ and the MECQ (modified ECQ) last April and May 2021. This is a clear indication that managing risks, instead of shutting down large segments of the economy, stands a far better chance of improving both economic and health outcomes,” Chua added.
For the rest of the year, the economy needs to grow around 8.2 percent to hit the lower end of its target of 6 percent, and 10.1 percent to reach the higher end of the target which is 7 percent, noted Mapa.
Chua said “prospects for a strong economic recovery in 2021 remain promising,” amid “speed bumps given the current ECQ in Metro Manila and other parts of the country.”
He said how the economy will fare after the third round of ECQ in Metro Manila will also depend on how the country can manage the health risk associated with the imposition of the ECQ, thus the need to manage the risk to lift the ECQ sooner.
What the government will do is to “maximize the present ECQ to inoculate as many as we can… and minimize the risk in the second half,” he added.
Chua stressed the government is managing the ECQ better this time with the transport sector still in operation, allowing more businesses to operate as well as exempting more workers from the curfew currently in effect together with the quarantine.
“We are able to balance both the economic and health concerns. Because we (now) know this virus, what to do and what not to do,” he said.
According to Chua, the Development Budget Coordination Committee will continue to review the recent economic data and the risks associated with the COVID-19 Delta variant “to fine-tune our growth targets and adjust our recovery strategies.”
