PH economy grew 5.8% in Q4 but may miss full-year target

Economists forecast the Philippine economy grew by 5.8% in the fourth quarter of 2024, accelerating from the 5.2% growth in the third quarter, but likely falling short of the government's 6% to 6.5% target for the full year.

The median estimate for the full-year 2024 GDP growth is 5.7%, which is below the Development Budget Coordination Committee's revised goal.

If realized, the 2024 growth would be faster than the 5.5% print in 2023 and the fastest annual economic growth in two years.

This projected growth is attributed to robust private consumption, strong government spending, improved purchasing power from disinflation, and increased employment in the services and manufacturing sectors.

Remittances from overseas Filipino workers also contributed to consumption despite a weak peso.

Real loan growth and double-digit increases in government expenditures further supported economic activity.

However, export underperformance, high vacancy rates in private construction, and the POGO ban are seen as factors that weighed on fourth-quarter growth.

The full-year average growth is estimated at 5.9% by some institutions, while others project lower figures, such as the ASEAN+3 Macroeconomic Office at 5.8%.