When one sifts through the data however, the optimism is more guarded and pragmatic. The growth was fueled by the services sector and increased consumer spending which are more vulnerable to market forces than export-driven industries.
This is not to say that the 7.1 percent growth isn’t a cause for pats-in-the-back for Aquino administration officials.
Growth fueld by the service sector also means the economy was driven by the still burgeoning IT and Business Process Outsourcing (BPO) industries which spurs growth in businesses like fastfood, retail and real estate. The good news is, that these businesses are projected to experience continued growth in the years to come.
But we hope the statistics hold true and the booming IT-BPO fueled growth won’t be a one-trick pony that would collapse if and when the US, North American and European markets all decide to significantly cut back on outsourcing their work.
As Cebu Business Club president Gordon Alan Joseph said the manufacturing sector should experience a revival in order to shore up the current pace of economic growth experienced in the country. That, along with tourism and the IT-BPO growth would help boost the economy and result in better employment for Filipinos.
Lest we forget, the agriculture sector should also be supported by the national government to ensure food and material security for the country in this age of climate change whether abnormal weather patterns are the “new normal.”
The information technology and communications industry is enjoying considerable growth but as with everything based on one industry, progress isn’t universally guaranteed.
The Philippines has become a preferred destination for IT-BPO owing to the English proficiency and Web savvy of its citizens, who rank among the best in the world. Owing to lowered labor costs and the sheer numbers of India and even China, however, the country faces stiff competition.
Then there’s the new policy by the Philippine Economic Zone Authority (PEZA) to drop the incentives for expansion among businesses in Manila and Cebu, which even if it’s intended to promote expansion in Mindanao, is still seen to affect growth in these areas.
Whatever the next policy moves of this administration will be, we hope there would be greater involvement of all critical stakeholders so that the positive outlook for growth at the end of the year would be sustained for years to come.