The Philippines’ gross domestic product (GDP) grew at a slower pace by 7.1% in the third quarter, as the spread of the COVID-19 Delta variant forced the government to reimplement stricter lockdowns. However, it also exceeded analysts’ expectations.
The third quarter figure reported by the Philippine Statistics Authority on Tuesday, November 9, is lower than the 12% growth posted in the second quarter of 2021. The second quarter figure had been revised upward from the initial 11.8%.
But the latest figure beat projections by analysts, who had expected GDP growth of only under 4%.
Among the major economic sectors, industry and services posted positive growth rates of 7.9% and 8.2%, respectively.
Meanwhile, agriculture posted a contraction of 1.7%.
Household final consumption expenditure grew by 7.1%.
In 2020, third quarter GDP contracted by 11.6%.
During the third quarter of 2021, the economy was affected by the reimposition of enhanced community quarantine (ECQ) in Metro Manila and urban centers in the Visayas and Mindanao for part of August.
The National Economic and Development Authority earlier estimated that the two-week ECQ cost the economy at least P210 billion.
Tropical cyclones in September also hurt overall growth, as farmers’ produce were wiped out due to bad weather.
Socioeconomic Planning Secretary Karl Chua earlier estimated that the long-term total cost of the COVID-19 pandemic over the next 40 years would be P41.4 trillion.
Target within reach
State economists aim for GDP, a monetary measure of the value of all final goods and services a country produces in a specific period, to grow by 4% to 5% for the entire 2021. This is a tempered outlook from the ambitious goal of a growth rate between 6.5% and 7.5% projected in December 2020.
With the latest figure, average GDP growth from January to September stood at 4.9%, within the upper end of the government’s target range.
Chua said that with growth jumping higher than expected in the third quarter, the target is likely to be hit, if not surpassed.
“So long as there is no unexpected new risks like a stronger [coronavirus] variant or global surge, we are clearly on track to strong recovery,” he said.
In a tweet, Bank of the Philippine Islands chief economist Jun Neri agreed that the target can be achieved.
While the economy expanded, Ibon Foundation executive director Sonny Africa noted that jobs have yet to come back.
“We’re seeing jobless growth at its fiercest. The economic managers pat themselves on the back for reported 7.1% GDP growth in the third quarter,” Africa said.
Unemployment fell by 1.2 million between the second and third quarters, but jumped to 4.25 million in September, the highest in 2021.
“The strategy is wrong. The results are clear,” Africa said. – Rappler.com