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.
- With the actual 2Q09 results, the Philippines is now on track to meet upper end of the govt’s.target 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%.
Philippines can achieve +1.8% growth for 2009; Look at election themes