The economy expanded by 7.1 percent in the third quarter of the year, which the government attributed to a “careful balancing” between pandemic and non-pandemic needs.
But this is slower than the 12- percent annual expansion recorded in the previous quarter, as the country dealt with the highly contagious Delta variant, which led to tighter restrictions during the period.
The Philippine Statistics Authority (PSA) yesterday reported the economy in the third quarter posted its second consecutive quarter of year-on-year growth, coming from an 11.6 percent contraction in the same period in 2020 due to the impact of the coronavirus disease 2019 (COVID-19) pandemic.
Karl Kendrick Chua, socioeconomic planning secretary, said in a virtual press briefing yesterday the third quarter economic growth is among the highest in the Asean and the East Asian region.
“In the third quarter of 2021, we contained the Delta variant and sustained our economic expansion even as stringent quarantines were in place. Our strategy was correct. The results are clear,” according to the joint statement of economic managers read by Chua.
“On a seasonally adjusted quarter-on-quarter basis, the economy expanded by 3.8 percent.
This indicates sustained recovery despite two weeks of the enhanced community quarantine (ECQ) and a month of modified (ECQ) in the country’s economic centers,” he added.
Chua said a careful balancing between COVID-19 and non-COVID-19 needs led to the continued expansion of most sectors.
The industry sector expanded by 7.9 percent, while the services sector grew by 8.2 percent.
In contrast, agriculture declined by 1.7 percent.
Chua said the increase in palay production, which was aided by the continued implementation of the Rice Competitiveness Enhancement Fund, was more than offset by typhoon damage to other agricultural crops and by the African swine fever to livestock.
“With strong third quarter growth and overall performance in 2021, we are on track to reach the high-end of our four to five percent growth target for 2021. Year-to-date growth is currently at 4.9 percent,” Chua said.
Claire Dennis Mapa, national statistician, said in the same press conference that to reach the government’s full-year goal, the fourth quarter GDP must range between 1.7 percent and 5.3 percent.
“With adequate supply of vaccine doses, the government is further accelerating the vaccination program over the next few weeks. With current trends, we expect to achieve alert level 1 by the onset of the New Year,” Chua said.
“To further sustain our growth this year and next year, the government will further accelerate the vaccination program, reopen to alert level 1 in January 2022, and maximize the use of the 2021 budget,” he added.
Chua also said more efficient public spending will enhance economic expansion.
“In the third quarter, national government disbursement surpassed the programmed level by four percent. Sustaining this into the fourth quarter makes achievement of our growth target certain,” he said.
Meanwhile, Chua said it is possible for the economy to return to the pre-pandemic level or the 2019 nominal GDP as early as the first quarter of 2022.
“To get to pre-pandemic nominal GDP level it will be certainly in 2022, even as early as the first quarter,” Chua said.
“For the upper middle-income country, it is really slated end of 2022 or early 2023. Given the strong progress, the likelihood of achieving that even within 2022 is now higher,” he added.
Mapa said in real terms, the GDP in the first nine months of the year is P13.32 trillion, higher by 4.9 percent versus the first nine months of 2020 which is P12.7 trillion.
“For the first nine months of 2019, our GDP was estimated to be about P14.1 trillion. So comparing our nine months 2021 performance versus the pre-pandemic of 2019. We are still down by about 5.7 percent,” Mapa said.
“So long as there is no unexpected new risk, like a stronger variant or a global surge, then I think we are clearly on track to a strong recovery,” Chua said.
