The Philippine economy will likely grow at the low-end of the government’s target this year, according to the Department of Finance.
Finance Secretary Benjamin Diokno said strong household spending in the fourth quarter would lift overall growth for 2023 after the gross domestic product expanded 5.9 percent in the third quarter and 5.5 percent in the first nine months.
“We are confident that the country will post a full-year economic growth that is close to the low-end of the DBCC’s [Development Budget Coordination Committee] growth assumptions of 6.0 to 7.0 percent for 2023 as inflation eases, labor market conditions remain strong and consumer spending increases, particularly during the holiday season,” Finance Secretary Benjamin Diokno said.
Diokno said the economy, as measured by gross domestic product, should grow by at least 7.2 percent in the fourth quarter to achieve the low end of the DBCC’s growth assumption for 2023.
The Philippine Statistics Authority earlier reported that the economy expanded 5.9 percent in the third quarter, the strongest among major economies in Asia.
The third-quarter GDP performance was faster than 4.3 percent registered in the second quarter and exceeded the expectations of private analysts with a median forecast of 4.9 percent.
Diokno said the GDP growth outturn in the third quarter outpaced major economies in Asia that released their data for the period such as Vietnam (5.3 percent), Indonesia and China (4.9 percent), Malaysia (3.3) and Singapore (0.7 percent).
“This strong performance is buoyed by robust domestic demand despite high inflation, improved government spending and a better global growth outlook,” he said.
The average GDP growth in the first three quarters reached 5.5 percent, exceeding that of China (5.2 percent), Indonesia (5.1 percent), Vietnam (4.2 percent), Malaysia (3.9 percent) and Singapore (0.5 percent).
Diokno said the growth in the fourth quarter would be supported by the continued acceleration of government spending and the rebound in manufacturing activities, given the improved global economic outlook for the year.
He said the deceleration of inflation would propel domestic demand and help the economy expand closer to the low end of the growth target.
“The improving outlook for inflation, strong fiscal position, sound external conditions and robust labor market, among other positive indicators should pave the way for the expansion of activities of businesses, households, and the rest of the private sector,” he said.