Results of governance reform measures, along with seasonal uptick of economic activities during the last quarter of the year, are expected to boost the domestic economy in the coming months, according to an economist.
The Philippine economy, as measured by gross domestic product (GDP), grew by 4 percent in the third quarter this year, slower than year-ago’s 5.2 percent and quarter-ago’s 5.5 percent.
Rizal Commercial Banking Corporation chief economist Michael Ricafort said in a report that opportunities in the last quarter of the year could help ensure an average of 5 percent full-year expansion.
He said exports, which grew 1.4 percent in the third quarter, remain resilient even with higher United States tariff rates since Aug. 7.
Ricafort said there was frontloading prior to the implementation of the new tariff rates but exports to other markets also grew as a diversification move.
He said improved weather conditions, normally in the last quarter of the year, are expected to boost economic activities and growth.
“Going forward, investor confidence could improve that, in turn, could lead to faster economic/GDP growth if reform measures, especially to further improve ESG (environment, social and governance) standards, to better align with global best practices, are taken seriously,” Ricafort said in his report.
Federation of Philippine Industries chairperson Beth Lee attributed the slower performance to natural calamities and investigation of anomalous government infrastructure projects.
“What is still front and center is the anti-corruption drive. We must take the bitter pill of anti-corruption reforms to get better and move forward — anchored on transparent infrastructure spending,” she said in a statement.
“For local industries, this is also an opportunity to regain momentum, with (the) government prioritizing locally sourced materials that meet product standards, priced correctly to benefit both manufacturers and public projects. This is the path to rebuilding confidence and putting growth back on track.”
In another statement, Makati Business Club executive director Apa Ongpin said slower economic growth “is an indirect effect” of the corruption scandal, following moderate government spending on infrastructure projects.
Ongpin echoed Department of Economy, Planning, and Development Secretary Arsenio Balisacan’s belief that addressing corruption needs a whole-of-society approach.
“The Makati Business Club agrees with Secretary Balisacan that the private sector should continue to champion good governance. Our role as watchdogs is all the more vital and these results show how good governance is good economics. Public officials must be held accountable, in order for the country to encourage both domestic and foreign investment,” Ongpin said.
PNA PHOTO