Balisacan expects Q2 GDP growth to ‘further moderate’

The Philippine economy’s growth rate is expected to moderate further in the second quarter of the year, National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan said Tuesday.

On the sidelines of the Post-State of the Nation Address Philippine Economic Briefing in Pasay City, Balisacan was asked about his outlook on gross domestic product (GDP) growth for the April to June 2023 period.

“We’ll probably see [economic] growth to further moderate,” the NEDA chief said.

In the first quarter of the year, the economy as measured by GDP—the total value of goods and services produced in a specific period—grew by 6.4%, slower than the 8% growth rate seen in the January to March 2022 period and lower than the downwardly revised 7.1% growth recorded in the fourth quarter of 2022.

This was the economy’s slowest footing since the country exited the pandemic-induced recession in the middle of 2021, as elevated inflation dampened consumer spending.

Despite a conservative outlook on the second quarter’s growth, Balisacan said it would not be "far enough, down enough, to allow us to miss the target."

The Marcos administration has set a 6% to 7% GDP growth target for 2023.

“I’m still hoping that we will achieve the target 6% to 7%, at the very least 6%. With the growth in the first quarter of 6.4%, we would need 5.9% for the last three quarters to achieve the 6% growth,” Balisacan said.

“I think, hoping that we won’t have any major shock in the external market, remember again Russia is threatening to cut the exports… and we are seeing some uptrend in the Brent oil indices. We hope these are just short-term things…,” he said.

The economic managers have maintained their GDP growth outlook for 2023 at 6% to 7%, as well as their projection of 6.5% to 8% economic growth for 2024 to 2028.

Their GDP outlook also considered the 6.4% growth seen in the first quarter of 2023, which outpaced the growth in other developing and emerging economies, such as Indonesia, China, and Vietnam. — VBL, GMA Integrated News