GDP growth beats estimates
Jake Lloyd-Smith in Singapore
The economy grew 3.4 per cent last year thanks to robust performances in the agricultural and service sectors, which offset weaker exports and sluggish manufacturing, officials said.
The figure beat an average of private-sector forecasts for expansion of 3 per cent. Gross domestic product growth last year also beat the Government's estimate of 3.3 per cent. GDP growth in 2000 was 4 per cent.
Song Sen Wun, an economist at G K Goh in Singapore, said: 'They have delivered on the headline growth, although one is a little suspicious about the quality, however. It is coconuts and rice.'
The performance made the Philippines one of Southeast Asia's fastest-growing economies last year, despite the global economic slowdown, a hi-technology slump and dislocation caused by the September 11 terror strikes in the United States.
The data, from the National Statistical Co-ordination Board (NSCB), put fourth-quarter year-on-year growth at 3.8 per cent. Third-quarter growth was revised to 3.3 per cent from 2.9 per cent.
Raphael Lotilla, deputy director-general of the National Economic Development Authority, said: 'The economy displayed new-found strengths in 2001, enabling it to overcome the political shocks caused by the previous administration [of president Joseph Estrada], worldwide retrenchments in the hi-tech sector and the September 11 terrorist strikes.'
In January last year, Estrada was replaced by deputy Gloria Macapagal-Arroyo after a military-backed popular revolt.
Mrs Arroyo has made reviving the economy and reducing poverty her top priorities.
Economists said good weather helped boost farm output. Last year, agriculture and fishery production grew 4 per cent, up from 3.6 per cent the previous year. The sector represents 20 per cent of GDP and employs almost 40 per cent of the workforce.
Services grew 4.3 per cent last year, from 4.4 per cent rate in 2000. Manufacturing grew 2.2 per cent last year, down from 5.6 per cent in 2000. Weaker demand saw exports drop 3.3 per cent last year after surging 17.7 per cent in 2000.
'The adverse effect of the weak global economy is . . . manifested by the negative streak in total exports during the last three quarters of the year, with the largest contraction recorded in the fourth quarter, of 9.2 per cent,' the NSCB summary said.
Government officials yesterday stuck to their GDP forecast for this year of between 4 per cent and 4.5 per cent, underpinned by growth in agriculture of between 2.7 per cent and 3.6 per cent.
Mr Song said he was less optimistic than the Government, saying much depended on the weather.
The complex interaction of ocean temperatures and rainfall patterns over the Pacific known as El Nino can, in a severe year, bring drier conditions to much of Southeast Asia, including the Philippines.
The extent of the challenges facing Mrs Arroyo and her administration were underlined by a poverty survey, released by the NSCB this week. Using data collected in 2000, it showed 39.4 per cent of Filipinos were poor, up from 36.8 per cent in 1997. 'Poor' was defined as having an annual income of less than 13,823 pesos (about HK$2,103).