Philippines: GDP growth slows in Q4 on Typhoon Haiyan impact, 2013 annual reading accelerates
January 30, 2014
GDP expanded 6.5% in Q4 over the same period last year. The reading came in below the revised 6.9% rise recorded in Q3 (previously reported: +7.0% year-on-year). While Typhoon Haiyan had a negative impact throughout the economy, Q4's result beat market expectations of growth slowing to 6.0%.
Domestic demand took a substantial hit, with private consumption slowing from a 6.2% expansion in Q3 to 5.6% rise in Q4. Moreover, government consumption contracted 5.2% in Q4, which drastically contrasted the 4.6% increase seen in Q3. Fixed investment growth tallied a 7.0% rise (Q3: +11.9% yoy).
In the external sector, exports of goods and services expanded 6.4% in the fourth quarter, down from the 12.8% increase observed in the third quarter. Imports tumbled to a 1.9% increase (Q3: +16.4% yoy). As a result of the relatively larger drop in imports, the external sector's net contribution to overall economic growth increased from minus 2.0 percentage points in the third quarter to plus 2.0 percentage points in the fourth.
In the full year 2013, GDP expanded 7.2%, building on the 6.8% increase tallied in 2012.
The government expects growth of between 6.5% and 7.5% in 2014. FocusEconomics Consensus Forecast panelists expect economic growth to reach 6.4% in 2014, which is unchanged from last month's forecast. For 2015 panelists expect growth to hold steady at 6.4%.
Author: Carl Kelly, Economist