Philippine economic growth slows slightly in 2nd quarter of 2012

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Monday, September 3, 2012

EDSA, the main thoroughfare of Manila.
Image: Exec8.

The Philippine economy grew by 5.9%, annual rate, during the second quarter of 2012 which is less than the first quarter's figure of more than 6% annual rate, as reported by The Associated Press. According to Economic Planning Secretary Arsenio Balisacan, strong domestic demand from the services sector and spending from money remitted by expatriate Filipinos helped boost the nation's economy despite the ongoing global economic crisis.

In spite of this growth, numerous risks still lurk around the corner, said Balisacan. He said that changes in China and the El Niño remain as the biggest challenges to the economy. Balsican also noted that poor infrastructure may also have a negative impact although spending on infrastructure, which may cost nearly $200 million in investment, may contribute to growth.

The Philippines central bank has cut key interest rates three times already this year in order to continue this economic expansion. Analysts, such as economist Eugene Leow of Singapore-based DBS bank, agree that, "There is definitely room to further cut rates if needed," in order to promote further growth.