Friday, August 31, 2007

Philippines posts 7.5% GDP growth in 2nd quarter. Yeah, really!

I wish there was someone with whom I could share my enthusiasm over the Philippines' second quarter year-on-year GDP growth of 7.5%.

Receiving news like that gives me such a dumb uplifting rush. It combines analyzing numbers, following the news, tracking developments, and hoping for the Philippines prosperity. How dorky is that? Sometimes I take a step back and listen to my own thoughts from an objective point of view and realize that they are so geeky that even the run-of-the-mill geek would toss me disappointed looks of incredulity.

To the uninitiated: Economic growth of this level is something the country has not seen since the post-EDSA euphoria of 1987. It is well above the high end of the government's targeted 6.1-6.7% GDP growth for this year-- and even the low end of that target was previously considered a lofty pipe dream by economists and observers. This isn't just a one-time fluke. The country has averaged 5-6% growth since 2002, without once having a quarter of negative growth. We hear so much hot talk of China and India and Vietnam's soaring economies... 7.5% GDP growth, if it could be sustained, would put the Philippines right up there in their league. That's the kind of development that makes other countries jealous. It means that the economy is on the right track.

And the flood of economic good news just keeps on coming. In a country where the currency's exchange rate is something that has always depreciated, the peso has strengthened more than 20% off of its all time low, and is cited as one of the best performing currencies in Asia for the past years. Last year's budget deficit was an 8 year low, and next year should bring us the first balanced budget in a decade or so. The country's balance of payment surpluses are always exceeding expectations. The debt-to-GDP ratio has gone down significantly, and in 2009 it will be down to levels considered manageable. Naysayers said the EVAT law would send prices of goods spiraling to apocalyptic levels, but inflation decreased drastically and is steady at ~2%.

I could go on and on with the numbers but you can see in the streets that things are getting better all the time. Roads are being improved, airports are being built, businesses are popping up, companies are expanding. It's still far from perfect, of course, but anyone that goes out into the world with their eyes open can see the improvements. Every time I go home to Dumaguete once every few weeks there's another establishment or improvement to greet me. All the naysayers have to do is watch (without their heads up their asses) the presentation at the SONA, and see a great lineup of infrastructure projects that are sure to keep our train chugging along.

Although our predictable airheaded media will fire off their tirades of "lies lies hurf durf there's still a poor guy over there", the economic plan is undeniably working, and with every day that goes by we have more developments and numbers that prove it.


  1. PGMA lackey. (Joke!) :-)

    Hopefully this GDP does not mean that the rich people's economic output grew 20% while the poor people's grew 2%, making a national average of 7.5%.

    Some of the naysayers say that the this growth is not sustainable since there are still fundamental problems in the economic policy, especially on the slow (though progressing) track of purging corruption in our revenue-generating agencies (BIR, BOC), the selling of government assets and GOCCs just to minimize the deficit, and the lack of spending on infrastructure, education, and social services, which would have a long-term impact on the economy, just not now.

    Well, it remains to be seen if PGMA's policies will remain sound up to 2010. Barring of course that something like the 1997 Asian financial crisis does not happen again.

  2. Yeah there are still real issues like the ones you mentioned, especially education. Seems infrastructure spending is finally getting the attention it needs though. I'm really hopeful that things can stay on track until 2010, so whoever takes the reigns then will have a much easier time of it.

    I'm no economist but sometimes I wish I was.. :p