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The Philippines 2022 GDP growth of 7.6% beats forecasts as economy surprises with 7.2% expansion in Q4
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The strong Q4 2022 economic expansion makes the Philippines the fastest-growing economy among its neighboring countries that have already reported their economic results for the period
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Socioeconomic Planning Secretary Arsenio Balisacan credits the improved COVID-19 risk management and easing of mobility restrictions for lifting economic outlook that boosted economic activity and created more jobs
The Philippine economy grew 7.2% in the last quarter of 2022, driving up full-year GDP growth to 7.6% as the government intensified efforts to put the economy back on its high growth track following the slowdown caused by COVID-19, the Philippine Statistics Authority said.
The robust expansion made the Philippines the fastest-growing among the major emerging economies in the region that have released their Q4 2022 real GDP growth, the PSA said.
Vietnam, currently the favorite of foreign investors that are exiting China or looking for an additional investment nest, reported 5.9% growth for the quarter, followed by China at 2.9%.
On a seasonally adjusted quarter-on-quarter basis, the Philippine economy expanded 2.4%, driven by increased economic activity mainly from pent-up demand as the economy fully reopened in the final quarter of 2022.
National Statistician Dennis Mapa said the fourth-quarter figure exceeded the median analyst forecast of 6.8% and lifted the country’s full-year GDP growth beyond the Development Budget Coordination Committee’s target of 6.5% to 7.5% for the year.
Mapa, the PSA head, identified the main contributors to the Q4 2022 growth as wholesale and retail trade; repair of motor vehicles and motorcycles, 8.7%; financial and insurance activities, 9.8%; and manufacturing, 4.2%.
For full-year 2022, the industries that contributed the most to annual growth were: Wholesale and retail trade; repair of motor vehicles and motorcycles, 8.7%; manufacturing, 5.0%; and construction, 12.7%.
The financial market appeared slow to react to the good news, with the Philippine Stock Exchange Index closing the morning trading down 2.9 points or 0.04% at 7,078.46 pts.
But Socioeconomic Planning Secretary Arsenio Balisacan was upbeat as he shared the economic results, crediting the government’s intensified efforts to ramp up the economy.
“I am pleased to announce that the Philippine economy’s growth remains robust as the government continues to intensify its efforts to restore the economy to its high-growth trajectory, creating more and better-quality jobs and speeding up poverty reduction,” Balisacan said in a National Economic and Development Authority press release. Balisacan also heads NEDA.
He said the government’s improved COVID-19 risk management and easing of mobility restrictions have created a positive economic outlook that boosted economic activity and created more jobs despite headwinds from abroad.
“We have drawn upon the lessons gained almost three years into the COVID-19 pandemic. Our strong economic growth performance for 2022 proves that our calibrated policies and strategies have helped put us on the path to recovery and on track to achieving our aspiration for an inclusive, prosperous, and resilient society by 2028,” Balisacan said.
The NEDA chief said the Q4 2022 robust performance reflected strong domestic demand, with three-fourths contributed by household consumption and almost a fifth by investment.
He said the improvements in labor market conditions, increased tourism, “revenge” and holiday spending, and resumption of face-to-face classes supported growth in the quarter, further reflecting a solid rebound in consumer and investor confidence in the economy.
“The growth in domestic demand was met by expansion in the services and industry sectors, with production in most subsectors back to their pre-pandemic levels,” said Balisacan.
He said services growth was mainly driven by wholesale and retail trade, while the expansion of manufacturing and construction subsectors supported industry growth.
In contrast, agricultural output fell slightly in Q4 2022, highlighting the need to strengthen the sector’s productivity and resilience against natural disasters, animal diseases, and climate change.
Nonetheless, Balisacan said economic growth came with more jobs amid vibrant labor market conditions, with the unemployment rate down to 4.2% in November 2022 from 6.5% in the same period in 2021.
“This performance marks our lowest unemployment rate since 2005. We also observed an improvement in the quality of employment relative to the same period last year, as more workers found remunerative and stable work in private establishments and became employed in full-time jobs,” he said.
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