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The Philippine economy grew 5.2% in the third quarter, slower than the adjusted 6.4% growth in the second quarter of the year
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The Q3 GDP is also lower than the 6% growth in the third quarter of 2023
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This brings average gross domestic product growth for the first three quarters of 2024 to 5.8%, slightly below the government’s target of 6% to 7% for the year
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With the latest GDP growth, the economy needs to grow by at least 6.5% to meet the government’s target for the last quarter 2024
The Philippine economy grew 5.2% in the third quarter, slower than the adjusted 6.4% growth in the second quarter of the year, according to the Philippine Statistics Authority (PSA).
It was also lower than the 6% growth in the third quarter of 2023 and brings average gross domestic product (GDP) growth for the first three quarters of 2024 to 5.8%, slightly below the government’s target of 6% to 7% for the year.
With the latest GDP growth, the economy needs to grow by at least 6.5% to meet the government’s target for the last quarter 2024.
Socioeconomic Planning Secretary Arsenio Balisacan in a statement said they “remain optimistic that this growth target is attainable.”
Of the Asian countries that have reported their third-quarter GDP growth rates, the Philippines remain one of the fastest-growing, following Vietnam’s 7.4%, and are ahead of Indonesia with 4.9%, China with 4.6%, and Singapore with 4.1%, Balisacan added.
PSA said the main contributors to the third quarter 2024 growth were wholesale and retail trade; repair of motor vehicles and motorcycles, which grew 5.2%; financial and insurance activities, up 8.8%; and construction, which increased 9%.
On the production side, the slowdown was due to the 2.8% contraction in the agriculture sector and a moderation of growth in industry and services sectors by 5% and 6.3%, respectively.
Balisacan said the crops subsector of the agriculture sector posted a year-on-year decline of 2.8%, reflecting the impacts of the El Niño phenomenon during the planting season and the effects of seven typhoons, in addition to southwest monsoon rains, during the harvest season.
The fishing and aquaculture sector also declined due to the 29-day fishing ban in Cavite and Bataan amid an oil spill incident last July and the cancellation of fishing trips due to bad weather conditions. Likewise, livestock production decreased due to the recent outbreaks of African Swine Fever, like what happened in Batangas last August.
Successive typhoons also suspended classes and work in government and some private offices, resulting in administrative delays and supply chain disruptions.
Domestic demand growth, meanwhile, remained robust at 6.6% in the third quarter of 2024, though a bit slower than the 7.4% in the second quarter.
Household spending accelerated 5.1% in the third quarter, encouraged by slower consumer price inflation.
The slowdown in tourism and leisure-related spending, however, offset this, as weather disturbances limited domestic mobility. Balisacan noted that 138 flight cancellations occurred during the third quarter, as reported by the National Disaster Risk Reduction and Management Council.
Total investments sustained its double-digit expansion of 13.1% in the third quarter. The turnaround in investments in durable equipment mainly drove capital formation growth. Private construction also sustained double-digit growth of 11.9%, while public construction slowed down by 3.7% due to administrative delays and disruptions associated with adverse weather conditions.
On the other hand, exports of goods and services recorded a year-on-year decline of 1%, while imports increased.
Exports of goods were pulled down by the sharper decline in electronics products, particularly semiconductors (-17.9%). Balisacan said the industry is undergoing inventory corrections and has yet to meet the demands for new products in the global market.
Meanwhile, the slowdown in the export of services was mainly due to the decline in air travel.
