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The Philippine economy grew by 7.2 percent in the last three months of 2022, bringing annual growth to 7.6 percent. This growth was primarily the result of pent-up demand as the market completely reopened in the midst of high inflation.

According to Arsenio Balisacan, secretary of the National Economic and Development Authority (NEDA), among the major emerging economies in the region that have released their GDP growth for the fourth quarter, the Philippines grew the fastest, followed by Vietnam at 5.9 percent and China at 2.9 percent.

He added in a conference on Thursday that despite external difficulties, “our better Covid-19 (coronavirus disease 2019) risk management and the relaxing of mobility restrictions have produced a favorable economic outlook, stimulating economic activity and creating more jobs.”

According to Balisacan, the government’s initiatives to support the recovery of the economy are effective.

In 2022, the economy grew strongly, which “proves that our calibrated policies and plans have helped placed us on the path to recovery and on track to reaching our vision for an inclusive, prosperous, and resilient society by 2028,” the president declared.

In the fourth quarter, when the economy was completely reopened, household consumption accounted for around three-fourths of domestic output, while investments made up about a fifth, according to Balisacan, pent-up demand fueled growth.

According to him, the growth in the quarter was underpinned by “improvements in labor market circumstances, higher tourism, vengeance and holiday spending, and resumption of face-to-face classes, further showing a good return in consumer and investor confidence in the economy.”

According to Balisacan, if it weren’t for the excessive inflation rate, which surged to 8.1 percent in December after rising to its highest level since November 2008, “growth may have been higher by another possibly 1 to 2 percentage points.”

It demonstrates how susceptible the total demand is to inflation, he continued.

According to Balisacan, domestic growth has resumed for many sectors of the economy, with the exception of others like the tourism industry.

We haven’t totally recovered yet in terms of capital income, he added.

According to Balisacan, the government is adamant about providing Filipinos with high-caliber jobs in order to reduce the need for them to work abroad.

According to him, poverty incidence would be reduced from 18 percent of the population in 2021 to a single-digit level by 2028 through inclusive growth across the archipelago.

The government’s 6.5 to 7.5 percent growth forecast for the year was exceeded by 7.6 percent, according to National Statistician Dennis Mapa, making 2022’s full-year GDP growth the greatest since 1976’s 8.8 percent.

According to Mapa, the wholesale and retail trade, repair of motorcycles and cars, financial and insurance operations, retail real estate, and home ownership, all contributed to the fourth quarter’s increase, which was slower than the previous quarter’s 7.6 percent.

Domestic demand, according to him, is still strong, with household final consumption expenditures (HFCE) climbing by 2.1 percent quarter over quarter, driven by food and non-alcoholic beverages, lodging and dining, and other products and services. The growth rate of HFCE was 7% year over year.

According to Mapa, the decline in the output of sugarcane, palay (rice), poultry, and egg production caused a 1.7 percent decline in the primary economic sectors of agriculture, forestry, and fisheries.

In the meantime, according to Balisacan, the government is actively assessing the current situation to handle the country’s elevated inflation rate, which is anticipated to return to within the government’s target range of 2 to 4 percent by the second half of this year.

He claimed that the government still permits the importation of a number of foods to increase domestic supply and that doing otherwise would harm both consumers and domestic growth.

However, Balisacan stated that through making investments in the agricultural industry, it eventually hopes to increase domestic production and food security.

He emphasized the need to make the sector resilient by saying, “As a result, the government will focus on modernizing agriculture and agri-business through agricultural mechanization, research and development, and greater inter-industry connections to create and diversify higher value products.”

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