DOF sees lower Q3 growth vs Q2 due to Delta.
The Department of Finance (DOF) expects the country’s economic growth in the third quarter to have slowed down compared to the double-digit expansion in the previous quarter due to the more transmissible Delta variant.
However, Carlos Dominguez, DOF secretary, expects the economy to start opening up this quarter, as the coronavirus disease 2019 (COVID-19) cases decline prompting the gradual easing of restrictions.
“Our second quarter GDP (gross domestic product) grew by over 11 percent. We expect in the third quarter to be lower than that because of the spike in the COVID-19 Delta variant,” Dominguez said in an interview with Bloomberg TV yesterday.
“However, we’ve seen our cases drop, and we’re beginning to open up our economy,” he added.
In the second quarter, the Philippine economy accelerated 11.8 percent, coming from a drop of 17 percent in the same period last year.
However, the government had to impose stricter quarantine measures over a limited period in the third quarter in various areas, including in the National Capital Region, to arrest the fast spread of the Delta variant.
The COVID-19 cases peaked at more than 26,000 new cases in September. Cases have declined since then to around 7,000 in the recent report.
“However, we still quarantine certain areas depending on the number of cases they have.
So it’s very, very targeted and we expect our economy to really start opening up this quarter,” Dominguez said.
The Development Budget Coordination Committee (DBCC) in August slashed its growth assumption for the Philippines this year amid the implementation of the tighter quarantine restrictions last quarter.
The DBCC revised its growth projection for 2021 to four to five percent, from its earlier assumption of six to seven percent, which was also revised downwards in May from the original forecast of 6.5 to 7.5 percent.
“We’re sticking to that growth target (four to five percent) and we think we’ll hit it,” Dominguez said. – Angela Celis