Underspending by the government and the slowdown in global trade constricted the economy to a lower growth in the now 2000-based GDP of 4.9 percent in the first quarter from the election stimulated 8.4 percent last year.
"The industry driven growth benefited from the sustained growth of manufacturing supported by other services, real estate, renting and business activities, and the recovery of agriculture but tempered by the lackluster trading activities and the second consecutive quarter of decline in public administration and defense and compulsory social security which used to be referred to as government services," says National Statistical Coordination Board Secretary General Romula Virola.
On the demand side, the growth came mainly from increased investments in fixed capital formation particularly durable equipment and Household spending.
As a result of the political crisis in the Middle East and North Africa, Net Primary Income (NPI) posted zero growth slowing down the Gross National Income (GNI) to 3.6 percent from 11.5 percent the previous year, partly also because of the peso appreciation.
On a seasonally adjusted basis, GDP grew by 1.9 percent while GNI grew at a slower pace of 0.9 percent in the first quarter of 2011 due to the slow down in NPI. With the rebound of palay, sugarcane and corn, the agriculture, hunting, forestry and fishery sector posted 0.9 percent growth in the first quarter from 1.8 percent in the fourth quarter of 2010. Industry grew by 3.2 percent from 2.1 percent gain in the previous quarter. The strong performance of the manufacturing sector ably supported by mining & quarrying and construction negated the contraction of electricity gas and water. Services sector likewise posted a 1.3 percent growth for the first quarter of 2010 after declining by 0.7 percent in the previous quarter, as all subsectors recorded positive growth except for public administration and defense which was affected by the underspending by the government.
With projected population reaching 95.1 million, per capita GDP grew by 2.9 percent while Per capita GNI grew by 1.7 percent and per capita HFCE grew by 2.9 percent.
Total exports, valued at Php735.4 billion pesos fell behind total imports valued at Php873.1 billion pesos at current prices, resulting to a trade deficit of 137.7 billion pesos. The current trade deficit stood at 4.6 percent of GNI from last year’s 1.3 percent.
GNI Implicit Price Index (IPIN) stood at 160.6 percent from 154.2 percent in the previous year or a 4.1 percent inflation.
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