Philippine economic growth slows to 5.2 percent in 1Q
MANILA, Philippines (AP) — Sluggish government spending slowed Philippine economic growth in the first quarter of this year, officials said Thursday.
The country's gross domestic product grew by 5.2 percent in the first quarter, down from 5.6 percent a year earlier and 6.6 percent in the last quarter of 2014.
Socio-Economic Planning Secretary Arsenio Balisacan said the slow pace of public spending, particularly in construction, resulted in growth that was lower than government and market expectations.
Balisacan said the economy is expected to expand faster in the coming months as public spending picks up.
Decades of corruption in government, and vulnerability to natural disasters such as typhoons, have meant the Philippines lagged other Southeast Asian nations such as Thailand, Malaysia and Singapore in economic development. But a push to reduce poverty and improve infrastructure by the government of President Benigno Aquino III has resulted in higher annual growth rates in the past half-decade.
Finance Secretary Cesar Purisima said the government was "less concerned" about the quarterly figures "than getting the foundations of our growth right."
"It is not always easy or fast, but growing with the right foundations makes our trajectory more sustainable," Purisima said. "We are cognizant of the opportunities ahead and will resolve to boost government capacity to spend at the right pace."
Among the five biggest Southeast Asian economies, he said the Philippines was the second fastest growing economy in the first quarter after Malaysia.
Balisacan said growth over the past five years "remains the highest" recorded since the mid-1970s despite the first quarter slowdown.
With a national population of 100.9 million, per capita GDP growth declined to 3.4 percent from 3.8 percent.
Service industries contributed the most to GDP growth, accounting for 3.1 percentage points followed by industry's 1.9 percentage points and 0.2 percentage point from agriculture.
"Despite this lower-than-expected growth, it is reasonable to believe that the economy will grow at a faster rate in the remaining quarters," Balisacan said.
He said the Department of Budget and Management has reported a "trend toward faster government spending."