Philippines growth slows sharply in first quarter
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- From the sectionBusiness
Growth in the Philippine economy slowed to its lowest pace since 2011 in the first quarter from a year ago, figures showed on Thursday.
The economy expanded 5.2% in the first three months from a year ago, which is the slowest rate since the last quarter of 2011, when growth was 3.8%.
The figure was also a lot lower than market forecasts for 6.6% growth.
The economy was hit by weak growth in the agriculture and manufacturing sectors, the government said.
Growth on a quarterly basis was also the lowest in six years. It came in at a seasonally adjusted 0.3% from 2.5% in the October to December period.
Weak demand from its major trading partners has had a bigger than expected impact on the export-driven South East Asian economy, said analysts.
Earlier this month, data showed that exports grew 2.1% in March, compared to over 12% in the same period a year ago.
“External demand has been challenging across a lot of the Philippines’ major trade partners such as Japan and China and I think that showed in the GDP (gross domestic product) print,” Jeff Ng, economist at Standard Chartered told Reuters.
“This poses downside risks to our forecast of 6% for full year GDP growth.”
Growth on track?
But despite the disappointing data, the government said it was not abandoning its growth target of 7-8%, at a news conference in Manila on Thursday.
Arsenio Balisacan, the economic planning chief, said government spending and exports were expected to pick up in the coming quarters.
The country’s central bank has kept the overnight lending rate steady at 4% since October last year as inflation remains within its target of 2 to 4%.