Philippine economy expands by 7.2% in 2013

According to the Institute for Development and Econometric Analysis, Inc. (IDEA) NewsBriefs, growth of the country's gross domestic product (GDP) was at 7.2 percent in 2013, beating market forecasts. Growth in the last quarter was at 6.2 percent, driving annual growth to its 7 percent level. This came as a surprise for economists, who expected a slowdown of the economy after the series of disasters that hit the country year. Moreover, this exceeds the government target of a 6 to 7 percent growth.

Per IDEA, growth was driven by expansion of different sectors. On the demand side, increased and sustained consumer and government spending, as well as higher investments in Fixed Capital Formation contributed to the higher growth. Higher investments also countered the negative effect of the decline in government spending during the last quarter on growth. Meanwhile, the Services sector recorded a 7.1 percent growth, posting a slowdown from 2012's 7.6 percent. Despite this, it still remains a large contributor to growth. The Manufacturing sector also drove the fourth quarter growth in the GDP as it recorded a 9.5 % growth, up from 2012's 6.8 %.

Likewise according to the same published report, the Philippine Stock Exchange index declined by 1.77 percent to 6,081.61 due to market reaction to the Federal Reserve's decision of tapering its quantitative easing (QE) program. The broader-all-share index also fell by 1.52 percent or 57.02 points to 3,691.75. Analysts also expect increased volatility, not only in the Philippine market, but also in international markets due to a possible slowdown of the Chinese economy and seemingly weaker performance of emerging markets.

Also, the Department of Budget Management (DBM) stated that PhP1.912 trillion of the national budget for 2013 has been released last November. This comprised 95.31 percent of the PhP2.006 trillion budget allotted for the said year. Moreover, this is 10.9 percent higher than the PhP1.724 trillion released in the previous year, which amounted to 94.93 percent of the 2012 budget. About PhP934.016 billion were released to departments and PhP205.104 billion were released for special purpose funds.

Moreover, analysts expect gross domestic product (GDP) growth in the last quarter of 2013 to be at 6 percent, lower than the level recorded in the previous quarter. Meanwhile, Moody's Analytics expect a higher growth at 6.6 percent, citing that the past super-typhoon caused growth to ease from its 7 percent level for the past three quarter. Socioeconomic Planning Secretary ArsenioBalisacan expects growth to be at 5.8 to 6.5 percent and the annual growth to be at percent. The factors that affected growth are robust domestic consumption, higher government spending, sustained investments, and rebound in exports.

Lastly, a recent report from the Social Weather Stations (SWS) showed that public satisfaction for top officials and government institutions declined last December. Net satisfaction score for Vice-President JejomarBinay fell 7 points to +62 from +69 recorded in September. Rating for Senate President Franklin Drilon declined to +25, ending with in the "moderate" level from "good". Ratings for the House of Representatives and the Senate ended at +26 and +33 respectively, down by a point and three points from September levels. Political analysts attribute lower satisfaction to the public's reaction to the pork barrel scamaccording to the researchers of IDEA.

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