The Philippine economy failed to meet the government’s 2024 target as a series of storms and external headwinds weighed on the country’s growth, the Philippine Statistics Authority (PSA) said on Thursday, January 30.
Data from the PSA showed that the country’s economic growth reached 5.2% for the fourth quarter, unchanged from the third quarter data but slower than the 5.5 percent in the same quarter last year.
The latest figure brought the full-year economic growth to 5.6 percent, faster than the 5.5 percent for the full-year 2023 but falling short of the government’s trimmed target range of 6.0 percent to 6.5 percent.
In a briefing, Socioeconomic Planning Undersecretary Rosemarie Edillon said the country had already experienced multiple issues that hindered its growth last year.
According to Edillon, the agriculture sector faced several setbacks, particularly between late October and mid-November, when six typhoons struck the country in succession.
The same data from the PSA showed that the agriculture, forestry, and fishing sector saw a decline of 1.8 percent last year in the fourth quarter of 2024 compared to the 1.3 percent growth recorded in the same quarter of 2023.
Apart from extreme weather events, Edillon said the Philippines also had to face geopolitical tensions and subdued global demand, just like in 2023.
For context, the manufacturing sector only grew to 3.1%, hindered by weak global demand caused by geopolitical tensions and the sluggish recovery of advanced economies.
Additionally, the semiconductor industry faced challenges updating its product offerings to align with shifting market demands.
“This suggests that these conditions may represent the new normal,” Edillon said.
Despite challenges, the economy, particularly the industry sector, experienced positive developments during the fourth quarter. Construction and manufacturing emerged as key growth drivers, with construction expanding by 7.8% and manufacturing by 3.1% year-on-year in the fourth quarter of 2024.
Additionally, government spending accelerated significantly, rising by 9.7% in the fourth quarter of 2024. This marked a notable improvement compared to a 1% decline during the same period in 2023, according to the Philippine Statistics Authority (PSA).
“While some challenges affect the entire economy, others exert pressure on specific sectors. Consequently, our economic performance in 2024 hinged on the impact of these factors on various sectors. Whether we can mitigate the negative effects or enable a swift recovery,” Edillon said.
She said the Philippine government is now focused on improving the country’s resilience to boost the economy. The economic growth target for 2025 remains 6 to 8 percent.
Edillon mentioned that the government will support farmers by accelerating the implementation of the National Rice Program to achieve a target production of 20.5 million metric tons of rice this year.
She also emphasized the government’s commitment to investing in irrigation, mechanization, technology, and climate change adaptation measures for agriculture.
Additionally, Edillon said the country will promote investments in industries that require highly skilled workers while reskilling employees in the information technology and business process management (IT-BPM) sector to ensure Filipinos remain competitive in high-value services. (TCSP)
