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| The Philippine economy is the fastest growing in Southeast Asia. (Source: HRM) |
The country's gross domestic product (GDP) grew 5.6%, beating the 5.5% average growth rate reported in a survey of economists. Stocks extended gains to more than 1%. The local currency, the peso, fell 0.1% against the dollar.
Although the annual growth rate is slower than the government 's target of 6-7%, it is by far the fastest in the region.
Malaysia's economy, which was Southeast Asia's fastest growing at 8.7% in 2022, is likely to slow to 3.8% in 2023.
Meanwhile, Indonesia and Thailand will release economic data next month.
Speaking to reporters on January 31, National Economic and Development Authority Secretary General Arsenio Balisacan said the government believes the economy will grow at a rate of 6.5-7.5% by 2024, which will help the Philippines maintain its leading growth rate in the region.
The Southeast Asian nation, where consumption accounts for about 75 percent of GDP, also faces growing geopolitical risks amid tense relations with China in the South China Sea.
While government spending fell 1.8 percent thanks to fiscal consolidation efforts, Mr. Balisacan expects the expansion of services to continue to drive the economy's growth trajectory.
Even as consumption remains resilient, a sluggish global economy, rising inflation and interest rates still hamper the growth outlook this year, which has improved significantly, said Robert Dan Roces, chief economist at Security Bank Corp in Manila.
“The current growth driver depends on government spending,” he said.
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