Metro Manila (CNN Philippines, November 9) — The Philippine economy realized a faster expansion in the third quarter, thanks to increased government spending, as the country battled a slowdown in domestic consumption due to stubborn inflation.
Data from the Philippine Statistics Authority (PSA) showed Thursday that the local economy grew 5.9%, stronger than the 4.3% growth recorded in the quarter prior.
This brings the year-to-date average growth to 5.5%, with more efforts needed to achieve the government’s 6% to 7% target.
“The Philippine economy continues to grow despite several major headwinds that we have experienced and continue to experience,” National Economic and Development Authority (NEDA) Sec. Arsenio Balisacan said during a briefing.
Balisacan said the performance made the Philippines “the fastest among the major emerging economies in Asia that have released third-quarter 2023 GDP (gross domestic product) growth.”
Public spending picked up by 6.7% in the July-September period. This came after the government implemented catch-up plans as the 7.1% contraction posted in the second quarter weighed down economic growth.
The NEDA official was hopeful that this momentum would be sustained particularly in the last quarter to help hit the government’s goal.
Domestic consumption, however, posted a weaker growth of 5% due to higher food inflation.
Balisacan said curbing elevated inflation is “key to robust growth of the consumer spending.”
He said that the Philippine economy needs to accelerate by 7.2% in the fourth quarter to meet even the low-end of the target.
“So the focus is ensuring the decreasing inflation reported in October will be sustained in the coming months,” Balisacan said.
“We still have room for improving government spending. The indicators in the labor market shown yesterday are also very encouraging, especially seeing the quality of employment is improving,” he added.
