A blueprint for sustained economic growth

In the third quarter of this year, the Philippine Statistics Authority reported that the economy experienced a remarkable upswing, with a Gross Domestic Product (GDP) growth rate of 5.9 percent. This was propelled by heightened public spending despite persisting inflationary challenges.

Reports showed that the top contributors to this positive movement included wholesale and retail trade, construction, and financial and insurance activities. This development surpassed forecasts from analysts across different entities, which were within the 4.7 to 4.8 percent median estimate.

Consequently, Fitch Solutions unit BMI has adjusted its growth forecast for the Philippine economy this year. Originally projected at 5.3 percent, BMI has revised the GDP growth outlook for the country to 5.7 percent.

This quarter’s performance outpaced the previous one, positioning the Philippines as the fastest-growing economy among major Southeast Asian nations. All key economic sectors – agriculture, forestry and fishing, industry, and services – contributed to this robust performance, instilling confidence in both local and international businesses and investors amid ongoing global uncertainties.

While there are persistent global headwinds, the country’s stellar third-quarter economic performance buoys the confidence of local and international businesses and investors, and generates a positive sentiment regarding the overall national situation.

The encouraging figures and optimistic prospects are poised to continue well into the final quarter of the year, with the expected boost in consumer spending during the holiday season. The government aims for a full-year economic growth range of six to seven percent, further underlining the positive trajectory.

This positive economic outlook has reached the broader population with a Social Weather Survey indicating that nearly half or 46 percent of adult Filipinos anticipate an improvement in their quality of life in the next 12 months. This contrasts sharply with the five percent who hold a pessimistic view, while the rest believe that there will be status quo or no change at all.

Finance Secretary Benjamin Diokno asserts that the last quarter’s economic growth will be sustained by increased government spending and a rebound in manufacturing activities, propelled by an improved global economic outlook.

“The improving outlook for inflation, strong fiscal position, sound external conditions, and robust labor market, among other positive indicators, should pave the way for the expansion of activities of businesses, households, and the rest of the private sector,” Secretary Diokno said.

Given these favorable conditions, the current challenge is to leverage this momentum to strengthen initiatives for lasting economic growth at the national level.

The administration of President Marcos has laid down policies and programs to foster economic growth, providing an opportunity for the private sector, a crucial partner in national development, to play a pivotal role.

In the current positive economic climate, it is crucial to cultivate robust public-private partnerships to establish a conducive environment for businesses and investors, as well as enhance favorable conditions in the labor market.

During the holiday season, job opportunities, particularly in the service sector, become more abundant due to heightened demand for labor support. Directing investments into this sector can ensure sustained job opportunities throughout the year and not just during the holidays.

Additionally, seizing the positive economic sentiment can prompt widescale modernization programs in the agriculture sector, aligning with President Marcos’s priorities. Implementing modernization programs and increasing investment in the agriculture sector will not only contribute to economic growth, but also ensure national food security, create employment opportunities, and accelerate development in rural areas.

Looking ahead, collaborative efforts between the government and the private sector can capitalize on the conducive economic climate and the enabling investment environment under the Marcos administration.

Sustained and continuous economic growth hinges on the collaborative and harmonious efforts of both sectors, fostering benefits that extend beyond a select few and uplift the entire nation.