Economic Update (9.1.2009)

By Randell Tiongson on September 1st, 2009

Economic Update (9.1.2009)
    Philippines averts recession with better than expected 2Q09 GDP

  • The Philippine economy grew better than market expectations in the 2Q09.
  • COMMENT: GDP rebounded from a -2.1% contraction in the 1Q09 with a +2.4% growth on a seasonally adjusted basis.
  • The country has officially escaped a recession, helped by government pump-priming and steady remittances
  • The actual results were better than street expectations of +0.3% Yoy and +1.3% QoQ.
  • Philippine 2Q09 GDP grew 1.5%   Yoy and +2.4% over 1Q09.
  • On the demand side, the country’s resilient performance was driven by government spending which increased 9.1% Y/Y.
  • This was driven by aggressive pump-priming activities in the 2Q09.
  • Investments in construction expanded by 11.7 percent from 1.0 percent in 2008.
  • Public Construction rebounded magnificently with 29.9 percent growth from negative 5.6 percent in the previous year.
  • By industrial origin, the INDUSTRY sector carried growth in the 2Q09 with a seasonal +4.5% growth.
  • This was bolstered by the strong performances of Mining & Quarrying and Construction.
  • According to the NSCB, per capita GDP declined by 0.5 percent from 2.1 percent in the previous year.
  • Per capita PCE also slowed down to 0.3 percent from 2.1 percent.
  • At current prices, the per capita GNP now stands at P44,828 or US$937 for the first semester.
  • Philippines can achieve  +1.8% growth for 2009; Look at election themes

  • With the actual 2Q09 results, the Philippines is now on track to meet upper end of the govt’ range for FY2009 which is +1.8% growth.
  • With GDP growing by +1% in the 1st semester, the Philippines needs to expand 2.6% in the 2H09 to reach +1.8% full year growth.
  • THis figure is highly achevable according to NEDA officials.
  • Aside from improving global prospects, stronger domestic  consumption and election spending will prop up the economy in 2H09.
  • The official target growth range for the year is +0.8% to +1.8%.


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Economic Update (9.1.2009)