The Philippine economy expanded 6 percent in the third quarter as officials yesterday forecast at least the same growth rate for the full year, but warned of risks from the El Nino dry spell and presidential elections next year.
Service industries, which include real estate and retailing, were the main driver of growth in the third quarter, expanding 7.3 percent, which was the fastest pace since 2013. Agriculture showed signs of recovery, growing 0.4 percent compared with a contraction a year earlier.
The Philippines has been one of the best performing economies in Asia for several years, growing at an average rate of 6.3 percent between 2010 and last year.
Despite increased government efforts to raise living standards, the nation still faces considerable challenges including its vulnerability to typhoons and other natural disasters, poverty, corruption and poor infrastructure.
Officials said risks to the growth outlook include El Nino’s effect on agriculture and potential political uncertainty as Phillipine President Benigno Aquino III’s six-year term draws to a close. Elections are set for May.
“We are confident that after five years we have laid our house with firmer foundations,” Philippine Finance Secretary Cesar Purisima said.
He said the government’s budget for next year would meet its goal of investing 5 percent of GDP in infrastructure.
Weakness in the global economy hurt trade in the third quarter. The Philippines posted a trade deficit of 58.8 billion peso (US$1.25 billion) for the three months compared with a surplus of 7.3 billion pesos a year earlier.
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