Philippines Q3 GDP Growth Weakest in Over 3 Years


The Philippines economy grew an annual 6.1 percent year-on-year in the September quarter of 2018, following an upwardly revised 6.2 percent expansion in the previous quarter and below market consensus of a 6.3 percent growth. It was the slowest pace of expansion since the second quarter of 2015, mainly due to a slowdown in private consumption and investment while net external contributed negatively to GDP growth.

In the three months to September, household consumption expanded 5.2 percent year-on-year, compared to a 5.9 percent increase in the second quarter. Also, gross domestic capital formation rose by 16.7 percent, easing from a 21.5 percent growth in the previous quarter. The growth was driven by investment in intellectual property products (22.9 percent), followed by durable equipment (17.5 percent), construction (14.9 percent) and breeding stocks & orchard development (6.2 percent).

Net external contributed negatively to growth as exports rose less than imports. Exports increased by 14.3 percent, following a 12.6 percent rise in the second quarter. Sales of goods went up 16.9 percent (from 13.9 percent in Q2) and those of services rose 2.2 percent (from 8.4 percent). Meantime, imports increased faster by 18.9 percent, following an 18.5 percent rise in the preceding quarter, mainly driven by purchases of services (10.6 percent from 5.2 percent).

Meanwhile, government expenditure went up 14.3 percent, faster than an 11.9 percent growth in the June quarter.

On the production side, the services sector advanced 6.9 percent, compared to a 6.8 percent growth in the three months to June. Growth in the sector was supported by public administration & defense, compulsory social security (17.8 percent); financial intermediation (7.6 percent); transport, storage & communication (5.4 percent); trade & repair of motor vehicles, motorcycles, personal & household goods (5.6 percent); other services (7.5 percent) and real estate (5.3 percent). 

The industry sector expanded 6.2 percent, following a 6.5 percent growth in the preceding quarter. Output increases were seen in construction (16.1 percent), followed by electricity, gas & water supply (5.0 percent) and manufacturing (4.0 percent). Meantime, mining & quarrying went down by 1.1 percent, after a 6.9 percent drop in the prior quarter. Also, agriculture, hunting, forestry & fishing contracted 0.4 percent, after a 0.3 percent expansion in the previous period.

The Philippine government has revised down its gross domestic product growth target for this year to 6.5-6.9 percent from 7-8 percent previously.

On a quarter-on-quarter seasonally adjusted basis, the GDP advanced 1.4 percent, following an upwardly revised 1.5 percent expansion in the June quarter.

Philippines Q3 GDP Growth Weakest in Over 3 Years


Philippine National Statistical Coordination Board l Chusnul Ch Manan| chusnul@tradingeconomics.com
11/8/2018 2:56:22 PM