Philippines posts fastest half-year growth in over 20 years

The Philippines said Thursday it recorded its best half-year economic growth for more than 20 years as investor confidence improved following smooth national elections. The economy expanded by a surprisingly strong 7.9 percent in the first half of 2010, the government said, boosting hopes by President Benigno Aquino's new administration of sustained strong growth during his six-year term.
"We have once again shown that high economic growth is attainable for the Philippines," Economic Planning Secretary Cayetano Paderanga told reporters, adding full-year growth may now exceed the official target of 5.0-6.0 percent. The National Statistical Co-ordination Board said the 7.9-percent growth from January to June was the highest half-year expansion since the 9.3 percent posted in the second half of 1988. It was also sharply up from the 1.0-percent growth in the first half of 2009, when the world was still in the midst of the financial crisis.
Growth in the second quarter of 2010 also hit 7.9 percent, the board said, its highest level since the 8.3 percent recorded in the second quarter of 2007. "The peaceful national elections improved investor confidence, especially among local investors," the board said in a statement, explaining the second quarter growth that exceeded government forecasts.
Aquino won presidential elections in May by a landslide, paving the way for a smooth transition of power the following month with Gloria Arroyo standing down. Recent Philippine political history has been dominated by coups, revolutions and a dictatorship, and the enormity of Aquino's win gave the country a rare sense of political stability.
Aquino's predecessor, Gloria Arroyo posted annual average economic growth rates of 5.1 percent in her nine years in office but she was hounded by allegations of corruption, vote fraud and suffered plunging approval ratings. His government has said it is targetting growth of 7.0-8.0 percent during his time in power. Private economists agreed Aquino's strong electoral mandate and the resulting political stability would help attract investors and sustain growth. Government economists had previously said they expected the second-quarter growth figure to stay below 7.0 percent due to a drought that hit the key farming and fishing sectors.