Do not “lose heart” over the economy’s slow performance in the second quarter, said Finance Secretary Benjamin Diokno, as he maintained his view the government’s full-year growth target of 6 to 7 percent remains achievable.
“If you look at it historically, the Philippine economy, it goes up during the last year of every administration, and then the first year of the new administration it goes down. So don’t lose heart because we have designed a sound fiscal framework… we’re all behind the current fiscal plan, and we are on track as the country’s economic situation is sound and it will continue to be sound,” Diokno said during the Philippine Economic Briefing held in Laoag yesterday.
Last week, the Philippine Statistics Authority reported that the Philippine economy’s growth rate in the second quarter slowed down to 4.3 percent, the weakest recorded since the 3.8 percent contraction in the first quarter of 2021.
“An aggressive catch-up plan for infrastructure projects, quicker response by government-owned and -controlled corporations and strong and deliberate spending by resource-surplus local governments are essential parts of the solution to the relatively weak second quarter growth performance of the Philippine economy,” Diokno said in a Viber message to reporters.
A close look at the economic performance of Asian peers could give a balanced view of the country’s economic performance, he added.
Diokno mentioned the second quarter growth rates of other economies such as Singapore (0.7 percent), South Korea (0.87 percent), Hong Kong (1.5 percent), Taiwan (1.5 percent), Vietnam (4.14 percent) and Indonesia (5.17 percent).
“The Philippines is not as export dependent as some of its Asean neighbors. Its growth is consumption based, that’s why it is less susceptible to the weaker exports demand owing to the slowing global economy which is partly due to the aggressive monetary tightening, supply bottlenecks and rising commodity prices resulting from the ongoing Russian invasion of Ukraine,” Diokno said.
“The more dependent the country is on exports, the slower the economic expansion. This is mainly due to a slowing global economy,” he added.
The Philippine economy has to grow by 6.6 percent in the second semester to achieve the lower end of the six to seven percent growth target of the government for 2023.
“While there are formidable external challenges, the prospect for achieving this lofty goal is largely in the hands of the current administration,” Diokno said. – Angela Celis
