Philippine consumer demand and expenditure related to congressional elections has continued to boost the economy in the second quarter after a stellar first quarter, a senior official said on Saturday. "We see indicators for strong growth for Q2," Dennis Arroyo, head of policy planning at the economic planning agency, told Reuters in an interview.
"For example, note that election spending, a big factor in Q1, peaked not in Q1 but in Q2. Secondly, even the stock market.. peaked not in Q1 but also in Q2 and going on this month."
"We see signs of strong consumer spending, in particular car sales were quite up. So, Q2 will be strong." The Philippines enjoyed its highest annual growth in 17 years in the first quarter at 6.9 percent, thanks to healthy consumption fuelled by record remittances from millions of overseas workers and candidate spending before the polls on May 14.
But Arroyo said growth in the April-June period was unlikely to match the first quarter. "We were overjoyed with the 6.9 percent," he said. "I would rather be conservative."
The Philippines is targeting full-year growth of 6.1-6.7 percent this year, up from 5.5 percent in 2006. Arroyo said the third quarter was traditionally weak, as the rainy season dents consumption, but he expected fourth quarter annual growth to be strong after devastating typhoons last year knocked the final three months' performance. "So, hopefully with no typhoons this year we will see additional strong growth for Q4."