MANILA (UPDATE) - The Philippine economy grew faster than anticipated in 2022 as fourth quarter gross domestic product (GDP) growth reached 7.2 percent, preliminary government data released on Thursday showed.
This pushed the whole year GDP growth to 7.6 percent, exceeding the 6.5 to 7.5 percent target set by economic managers, and the median analyst forecast of 6.8 percent. It is also among the fastest in the world, according to the National Economic and Development Authority.
“Among the major emerging economies in the region that have released their 4th quarter 2022 real GDP growth, the Philippines grew the fastest, followed by Vietnam at 5.9 percent and China at 2.9 percent,” said NEDA Secretary Arsenio Balisacan.
Economic growth was also at 7.6 percent in the third quarter.
In a statement, the Presidential Communications Office said 2022's growth was the highest in 46 years since the 8.8 percent growth recorded in 1976.
The Philippine Statistics Authority said the industry and services sectors posted positive growths in the fourth quarter, with 4.8 percent and 9.8 percent, respectively.
However, the agriculture, forestry, and fishing sectors posted a contraction of -0.3 percent.
Balisacan said the strong fourth quarter growth reflected the full reopening of the economy and strong domestic demand.
Security Bank AVP and Chief Economist Dan Roces earlier said the increased consumption, lower unemployment that supports spending as well as the surge in big-ticket purchases are indicators of positive growth.
Unemployment in November eased to 4.2 percent, the lowest since April 2005, due to the continued economic reopening. This brought the first 11 months' total to near its pre-pandemic level.
Economists have said growth could be slower in 2023.
While attending the World Economic Forum in Davos, Switzerland, President Ferdinand Marcos Jr said the Philippine economy could grow 7 percent this year.
Balisacan said the government has maintained the growth target of 6 to 7 percent for 2023.
However, economists warned that the elevated inflation, a looming global recession, and the ongoing war between Russia and Ukraine remain risks to growth this year.
Economist Emmanuel Leyco said although the economy is clearly recovering, it is not felt by the majority of the population.
"The economy is growing but it's not being felt by the majority of the people because of high inflation. With no increases in their income, they will continue to experience the pain, the economy [is] growing but inflation continues to affect them," Leyco told ANC.
"Let us not look at purely the growth rate. Let us pay attention who is being hurt by continuing high prices," he added.
Baliscan said the government's priority is to bring down inflation, which is affecting the salary and purchasing power of Filipinos and in turn, also has an impact on the overall economy.