MANILA (3rd UPDATE) — The Philippine economy expanded 6.4 percent in the first quarter of 2023, the slowest following 7 quarters of above 7 percent growth, the state statistics bureau said on Thursday.
The country's gross domestic product (GDP) growth for the first 3 months of the year was slower than the 8 percent expansion in the same period last year, the Philippine Statistics Authority said in a briefing.
Construction, manufacturing, and financial and insurance activities were the top contributors during this period, the PSA said.
National Economic and Development Authority Secretary Arsenio Balisacan said this is the economy "normalizing" rather than slowing down.
"The economy is normalizing its previous trend. The better than expected first quarter performance this year implies that we are returning to our high growth trajectory despite the various challenges and head headwinds we have faced," Balisacan said.
Balisacan said the Philippine economy's growth was "fastest" among major emerging economies in the region that have released their Q1 data, including Indonesia, China, and Vietnam.
The GDP growth came as inflation remained elevated and above the government target of 2 to 4 percent. Inflation hit a 14-year high of 8.7 percent in January but started easing in the last 3 months and settled at 6.6 percent in April.
"The headline inflation rate appears to have reached its highest point decelerating to 6.6 percent in April 2023. We anticipate this downward trend to continue as inflation eventually eases toward the government's target range by the fourth quarter of 2023," he said.
In 2022, the Philippine economy grew faster than anticipated at 7.6 percent. The government expects GDP to grow between 6 to 7 percent this year.
To meet the 6 to 7 percent target, the economy must grow 5.9 to 7.2 percent in the next 3 quarters, Balisacan said.
He said threats to growth prospects in the following months include higher inflation, the African Swine Fever, as well as the El Niño phenomenon which could affect the agriculture sector such as rice production.
In a social media post, President Ferdinand Marcos, Jr. vowed his administration seeks to build a strong economy that would result to more jobs and investments.
"Unti-unti na natin itong naaabot habang patuloy ang pagtaas ng ating GDP growth rate na ngayon ay nasa 6.4 percent sa unang quarter ng taon," said Marcos.
"Nilampasan pa natin ang porsyentong naitala ng mga bansang Indonesia, China at Vietnam."
— Report from Jessica Fenol, ABS-CBN News