By Chino S. Leyco, May 12, 2022; Manila Bulletin
The economy grew faster than its pre-pandemic level in the first three-months of the year on the back of sustained growth momentum amid easing quarantine restrictions, the Philippine Statistics Authority (PSA) reported.
From January to March, the country’s economy, as measured by gross domestic product (GDP), expanded by 8.3 percent, quicker than the 7.8 percent recorded in the fourth-quarter last year, and a significant reversal of the 3.8 percent decline a year before.
Socioeconomic Planning Secretary Karl Kendrick T. Chua said the growth pace was the fastest in East Asia, and is now above pre-pandemic levels.
Based on the PSA data, the nominal GDP at current prices stood at P4.9 trillion in the first quarter, higher than the P4.43 trillion recorded in the same quarter of 2019.
Likewise, real GDP rose to P4.618 trillion from the P4.46 trillion in the first quarter of 2019.
“We have overcome our country’s greatest economic and health challenges,” the government’s economic managers said in a joint statement on Thursday, May 12.
On a seasonally adjusted quarter-on-quarter basis, the economy grew by 1.9 percent compared to the fourth quarter of 2021, signaling continued recovery despite the impact of more stringent alert levels due to the Omicron variant in early 2022.
In addition, the growth rate also exceeded most targets and expectations. The median analyst growth rate projection was 6.5 percent to 6.7 percent.
“There were speed bumps along the way, but our quick rebound from the Omicron surge showed that we have learned to live with the virus and shift from a pandemic to a more endemic mindset,” Finance Secretary Carlos G. Dominguez III said.
But despite the robust growth, the economic mangers recommended the retention of the government’s 7.0 percent to 9.0 percent growth target this year.
“We need to strengthen our domestic economy against external risks, such as the ongoing Russia-Ukraine war, higher global commodity prices, slowdown in China’s economic activity, and monetary normalization in western countries,” Dominguez said.
Economic expansions were broad-based across all sectors in the first three-months.
On the production side, all sectors expanded, driven by industry and services at 10.4 percent and 8.6 percent, respectively.
Meanwhile, agriculture slightly improved by 0.2 percent as growth was hindered by the African Swine Fever and elevated prices of agricultural commodities such as corn, pork, and sugar.
On the expenditure side, growth was driven by private consumption which went up by 10.1 percent, a stark reversal from the -4.8 percent figure in the same period last year.
Other expenditure items, such as investments and external trade, also expanded. Investments recorded a robust growth of 20 percent from -13.9 percent in 2021. Exports expanded by 10.3 percent, and imports grew by 15.6 percent.
In contrast, growth in government expenditure temporarily slowed down to 3.6 percent from 16.1 percent last year, as public construction contracted by 4.9 percent, as the election spending ban began towards the end of the first quarter.