Manila: The Philippines was the third highest-growing economy in the region in the fourth quarter of last year despite the impacts of geopolitical tensions and the series of typhoons that hit the country. Philippine economic growth settled at 5.2 percent in the fourth quarter of 2024, bringing the full-year economic growth to 5.6 percent.
According to Philippines News Agency, "While this falls short of our target of 6.0 to 6.5 percent, we are positioned as the third fastest-growing economy in the region, trailing Vietnam (7.5 percent) and China (5.4 percent) but outpacing Malaysia (4.8 percent)," National Economic and Development Authority (NEDA) Undersecretary Rosemarie Edillon said in a briefing Thursday. Edillon highlighted the country's resilience in the face of numerous setbacks, including extreme weather events, geopolitical tensions, and subdued global demand.
Last year, economic growth was mainly driven by the industry and services sectors. National Statistician Dennis Mapa reported that among the major economic sectors, industry and services expanded by 5.6 percent and 6.7 percent, respectively. In contrast, agriculture, forestry, and fishing declined by 1.6 percent due to disruptions caused by six typhoons in the fourth quarter.
On the demand side, household final consumption expenditure increased by 4.8 percent, while government final consumption expenditure and gross capital formation grew by 7.2 percent and 7.5 percent, respectively. Exports of goods and services rose by 3.4 percent, and imports increased by 4.3 percent.
Edillon emphasized the need for resilience and adaptability to sustain economic growth. She called for diversification of growth sources and highlighted the importance of investment in sectors requiring higher-level skills. Additionally, Edillon stressed the necessity of keeping food inflation low and stable through a multi-pronged approach.
Looking ahead to 2025, the government plans to regain growth momentum through strategic investments and resilience-building initiatives. Efforts to develop infrastructure, enhance economic competitiveness, and expand free-trade agreements are underway. The government will also focus on strengthening the agriculture sector, boosting tourism, and developing the talent pipeline to support growth in the information technology and business process management sector.
Finance Secretary Ralph Recto expressed optimism about the future, citing a lower inflation rate as a potential boost for consumption. He anticipated increased investments due to strong business interests following recent international engagements. The Department of Finance noted that the Philippines ranked as the second fastest-growing economy in ASEAN last year.
The government remains committed to reducing poverty and fostering inclusive growth, aiming to reduce poverty incidence to single-digit by 2028. Efforts will include the expansion of social protection programs and the integration of digital technologies to ensure support reaches the most vulnerable.
