The Philippine economy witnessed a 5.7% expansion in the first quarter, according to data released Thursday, falling slightly short of expectations due to persistent inflation and widespread drought.
National statistician Dennis Mapa disclosed that the growth rate, though commendable, was lower than the 6.4% recorded in the same period last year and below the analysts’ median forecast of 5.9%. Ser Percival Reyes from the Ateneo Center for Economic Research and Development described the figure as “quite disappointing,” attributing it to inflation and the severe heatwave impacting economic activities.
The country faced challenges from El Nino-induced drought and subsequent extreme heat, affecting agriculture, which grew by only 0.4% compared to 2.2% in Q1 2023, leading to a surge in food prices.
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Secretary Arsenio Balisacan applauded the nation’s economic resilience despite the hurdles, emphasizing that the growth target remains achievable, albeit with some slowdown in construction and household spending due to elevated food prices and the heatwave.
Household consumption saw a modest 4.6% increase, the slowest since the third quarter of 2010, excluding pandemic years, while growth was notably driven by financial activities, wholesale and retail trade, and manufacturing sectors, according to Mapa.
