Economic growth slows on drag from Boracay closure, policy steps

Economic growth slowed in the April to June period, falling below forecasts, due to "policy decisions" to ensure a more sustainable expansion, including the 6-month closure of Boracay Island, officials said.

Gross domestic product grew 6 percent in the second quarter, from 6.8 percent in the first 3 months of the year. This snapped 10 straight quarters of at least 6.5 percent growth. Economists polled by Reuters predicted a 6.7-percent expansion.

Socioeconomic Planning Secretary Ernesto Pernia said inflation had a "similar effect" in the second quarter as in the first quarter. He had flagged it as a growth "spoiler."

"This growth is less than what we had hoped for," Pernia told reporters. "To be fair and put things in proper context, the slowdown is partly due to policy decisions undertaken that are expected to promote sustainable and resilient development."

With first half growth at an average 6.3 percent, Pernia said the economy would need to expand by 7.7 percent in the second half to meet the low end of the government's 7 to 8 percent goal for the year.

"We will have to double time our efforts in terms of encouraging the sectors to be more productive and efficient in their activities," he said.



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