Finance Secretary Ralph Recto underscored that the Philippine economy is once again a frontrunner in Southeast Asia, posting the highest growth of 5.7% in the first quarter of 2024 despite the onslaught of El Niño.
Recto attributed the latest positive gross domestic product (GDP) number to the industry sector, the brightest spot among all economic contributors driven by strong domestic manufacturing.
The Philippines grew the fastest alongside Vietnam (5.7 percent) followed by Indonesia (5.1 percent), Malaysia (3.9 percent), and Singapore (2.7 percent).
“More than our performance in the region, what is to be celebrated here is the encouraging growth seen in the manufacturing sector as it is the most crucial sector for long-term employment, productivity, value-added generation, and innovation. This sets the course for the Philippines to become a premier manufacturing hub in Asia,” Recto said on Thursday.
The Department of Finance (DOF) chief likewise noted the significant growth in our manufacturing, calling a “major win for the country’s labor market.”
“Historically, nations that have achieved successful structural transformation have built competitive manufacturing industries. These industries can effectively harness our young, dynamic, and diverse workforce, which paves the way for a capital-intensive industry sector. Additionally, this is supported by our resilient and growing services sector,” Recto said.
The country’s economic expansion in the first quarter of 2024 was broad-based as all major production sectors registered positive growth, with the industry sector accelerating by 5.1 percent.
Manufacturing, the main component of the industry sector, expanded by 4.5 percent on the back of increased production of food, electronics, and chemical products.
The services sector likewise posted an expansion of 6.9 percent driven by the double-digit growth of the accommodation and food services at 13.9 percent, which indicates a sustained recovery of tourism-related activities.
The Department of Tourism (DOT) has recently reported that for the first three months of 2024, the country’s tourism receipts amounted to PHP 157.6 billion, a remarkable recovery rate of about 20.7 percent from the same period in 2019 before the COVID-19 lockdowns.
Meanwhile, the agriculture sector also posted a 0.4 percent growth despite the onslaught of El Niño mainly driven by higher poultry and egg production.
Despite the weaker global growth and geopolitical challenges, the strength in domestic demand continued to propel the country’s economic growth.
Household consumption remained robust as Filipinos spent more on recreation & culture and restaurants & hotels. This is supported by a healthy job market with historically low unemployment and underemployment rates boosted by consistent inflows of remittances from overseas Filipinos.
Government spending on public infrastructure projects recorded a double-digit growth of 12.4 percent as the ‘Build Better More’ program continues to gain traction, especially with the accelerated implementation of the Public-Private Partnership (PPP) Code.
Meanwhile, net exports also expanded by 9.5 percent due to the improvement in the exports of goods and services, growing by 7.5 percent.