Middle point of growth target achievable – Pernia

MANILA, Philippines - The Philippines could meet the mid-point of the economic growth target for this year as the agriculture sector has been largely spared from typhoons, said Socioeconomic Planning Secretary Ernesto Pernia.

He said a full-year economic growth rate of 6.5 percent “should be achievable.”

Economic managers expect gross domestic product (GDP) to grow between six to seven-percent this year and 6.5 to 7.5-percent in 2017.

In the first half of the year, the economy grew 6.9 percent, up from 5.5 percent in the same period last year.

As such, a growth rate of at least 5.1 percent would have to be attained in the second half of the year to attain the lower half of the full-year growth projection while a growth of over seven percent would have to be attained to meet the higher end of the target.

Aside from the usual drivers of growth—industry and services and the accompanying strong consumption trend—the agriculture sector may post a positive growth rate in the second semester. The sector declined 2.1 percent in the second quarter of the year because of the ill-effects of El Niño.

“There has been a lot of rain but not destructive so it’s going to be healthy for agriculture. And let’s hope that typhoons keep skirting the Philippines,” Pernia told reporters.

NEDA has also been advised by Pagasa that La Niña phenomenon expected to occur within the year is “supposed to be milder than anticipated.”

Pernia said, however, that government has contingency plans in the event a strong La Niña occurs.

“The NDRRMC (National Disaster Risk Reduction and Management Council) is on the ball in terms of preparations,” he said.

In July, Typhoon Nepartak moved away from the Philippines to threaten Taiwan. Last month, Typhoon Helen threatened Batanes but likewise exited to Taiwan

Growth in the third quarter, meanwhile is expected to be slower than seven percent posted in the second quarter of the year, Pernia said. This, however, is traditional because of normal business distruptions during the typhoon season.

The International Monetary Fund (IMF) and the Asian Development Bank (ADB) both raised their growth forecasts for the Phlippines this year and next, citing the country’s improved fundamentals and resilience to external headwinds.

The IMF raised the gross domestic product (GDP) outlook for the Philippines to 6.4 percent instead of six percent this year and to 6.7 percent instead of 6.2 percent next year.