MANILA — The Philippines economy grew much slower than market expectations in the first quarter this year as the effects of super typhoon “Yolanda” (international name ‘Haiyan’) continue to linger.
Compared to the 7.7 percent growth in the first quarter of 2013, this year’s Gross domestic product (GDP) rose by only 5.7 percent — 0.7 percent lower than the 6.4 percent median estimate of 20 analysts polled by Reuters.
However. Socio Economic Planning Secretary Arsenio Balisacan maintains that despite the slowdown in the country’s economic growth, the Philippines still remains the third fastest growing economy in Asia for the first quarter this year.
The Philippines is only next to China with 7.4 percent and Malaysia with 6.2 percent.
“The relatively slow growth is expected, given the magnitude of the destruction in production capacity. In agriculture, permanent crops, notably coconuts, were felled. Damage to agricultural output also disrupted supply chains, which may partly explain why food manufacturing output also declined. The tourism and insurance industries likewise slowed down in the first quarter as they are still reeling from the impact of natural calamities last year,” Balisacan said referring to the destruction caused bu earthquake in Bohol and typhoon “Yolanda” in central Visayas.
While the government is still confident to meet the full-year growth target of 6.5 to7.5 percent, Balisacan also stressed the need to speed up the government’s typhoon rehabilitation efforts.
“Reconstruction efforts will rebuild assets and restore supply chains. At the same time, we need to strengthen the capacity of people, families and communities to participate in the growth process once again,” he said.
“Growth in the first quarter of 2014 indicates that the economy will continue to grow at an increasing pace in the succeeding three quarters. The growth momentum will likely strengthen within the near-term, notwithstanding the risk and challenges that the economy is facing. We remain confident that we will meet the growth target of 6.5 to 7.5 percent for the full year of 2014,” he added.
With reports from ABS-CBN News