by Cathy Rose A. Garcia, ABS-CBNnews.com | 11/28/2012 5:36 PM
MANILA, Philippines - The Philippine economy grew by a surprising 7.1% in the third quarter, the fastest growth rate in Southeast Asia. But can the Philippines sustain this high growth rate?
Socioeconomic Planning Secretary Arsenio Balisacan on Wednesday said the Philippine economy will likely exceed its full-year gross domestic product (GDP) target of 5 to 6% for 2012.
"We posted the fastest economic growth within the ASEAN region. We are well on our way to surpassing our growth target of 5 to 6 percent this year and this economic expansion continues to be broad-based, as almost all sectors posted higher year-on-year growth rates," he said.
Phillip Hagedorn, ATR KimEng Asset Management director for investments, also expressed confidence the Philippines will breach the 6% GDP full-year target set by the government.
"Obviously 7.1% for this quarter is a surprise for us but I don't think we should be patting ourselves on the back yet. It's being able to sustain this growth for a long time is what we're looking after," he told ANC on Wednesday.
|Rows of condominium buildings are seen in Mandaluyong, Metro Manila, in this July 4, 2012 file picture. Photo by Erik De Castro, Reuters|
The Philippines posted the fastest third quarter economic growth within the ASEAN region. Indonesia posted the second highest GDP growth 6.2%, followed by Malaysia (5.2%), Vietnam (4.7%), Thailand (3.0%) and Singapore (0.3%). China reported a 7.7% GDP growth in the third quarter.
Hagedorn said the challenge for the Aquino government now is to prove that the high economic growth is no fluke.
"We saw with the previous administration that we were able to attain these high growth levels but for very short spurts. The challenge for our current government is to prove to the world this isn't a fluke... The test would be next year," he said, noting the Philippines would have to hurdle US and euro zone crises.
Meanwhile, Metrobank Research raised its 2012 and 2013 growth forecasts for the Philippine economy on the back of impressive growth on the back of "stellar" growth so far this year.
In a report, Metrobank Research said it revised upward its full-year growth forecast to 6.6% for 2012 from a previous forecast of 5.5%; and 2013 GDP growth of 6% from the previous forecast of 5.2%.
"The Philippine economy seems to be on the road to a higher growth trajectory, surprising markets with remarkable expansions in the first three quarters of the year. The economy is thus seen to cap the year way stronger than what was previously expected," Metrobank Research said in a report.