MANILA - The Philippine economy posted a faster-than-expected 5.6 percent growth rate in 2021 as looser COVID-19 restrictions propelled recovery, with GDP growing 7.7 percent in the fourth quarter, the state statistics bureau said Thursday.
The 2021 GDP growth is also above the 5 to 5.5 percent target set by the Development and Budget Coordination Committee in December.
Fourth-quarter growth was higher compared to the previous quarter, which was revised to 6.9 percent from 7.1 percent, and contrasted with the -8.3 percent growth rate in the same period in 2020, the Philippine Statistics Authority said.
Last year’s GDP growth was a significant rebound compared to the 9.6 percent contraction in 2020, largely due to the COVID-19 pandemic.
National Statistician Dennis Mapa noted that nominal GDP last year was very close to the nominal GDP pre-pandemic.
He said the GDP in 2020 fell to P17.939 trillion, but rebounded to P19.387 trillion in 2021, while it was P19.518 trillion in 2019.
“So if we compare 2021 versus 2019, current prices, we are down by about P131 billion or estimated 0.7 percent,” Mapa said.
Socioeconomic Planning Secretary Karl Chua said this bolstered economic managers’ forecast that the economy can return to its pre-pandemic level this year. Chua credited the rebound to loosening quarantine restrictions and the vaccination drive.
He added that with the omicron surge proving to be not as severe in terms of hospitalizations and deaths compared to previous surges, the alert level in the National Capital Region may be lowered “in the coming weeks.”
“We are on the correct path to a resilient recovery,” Chua said.
Metro Manila and other neighboring provinces are under Alert Level 3 until the end of January.
The PSA said the main contributors to the fourth quarter and full-year growth were: manufacturing; wholesale and retail trade; repair of motor vehicles and motorcycles; and construction.
“Among the major economic sectors, Agriculture, forestry, and fishing, Industry and Services all posted positive growths in the fourth quarter with 1.4 percent, 9.5 percent, and 7.9 percent, respectively,” the PSA said.
Industry and services registered positive annual growths of 8.2 percent and 5.3 percent, respectively. However, agriculture, forestry, and fishing posted a contraction of -0.3 percent, the PSA noted.
Economic managers are projecting the economy to grow between 7 to 9 percent this year.
Moody’s Investors Service meanwhile said it expects the Philippine economy to grow 6.8 percent this year, citing the continuing risk of new COVID-19 variants emerging.
“The recovery story is there, we think, perhaps not as strongly as government believes, but we think it’s intact,” said Christian de Guzman, senior vice president at Moody’s.
The Asian Development Bank earlier said that the Philippines lags behind its neighbors in returning to pre-pandemic growth levels.
"We will continue to pursue policies and reforms as we rebuild a stronger economy, one wherein every Filipino enjoys a safe, healthy and comfortable life," said Cabinet Secretary Karlo Nograles.
To this end, Malacañang reiterates its call for amendments to the Public Service Act, which would open key sectors to foreign investments, subject to safeguards, Nograles said in a statement.
He added government continues to back the proposed Livestock Development and Competitiveness Bill to improve the competitiveness of the livestock, poultry and dairy sectors, as well as the implementation of the Philippine Innovation Act to improve productivity.