The Philippines is the standout performer in Asia once again, as the economy continued to grow strongly in the third quarter.
The gross domestic product (GDP) — the broadest measure of the economy — grew by 7.1 percent in the third quarter, far outpacing the 6.2 percent notched the year before, data from the Philippine Statistics Authority (PSA) showed.
In the first nine months of 2016, GDP growth averaged 7 percent, right at the high end of the government’s 6-7 percent target.
The country is the fastest-growing economy in Asia so far, beating the likes of Malaysia, Indonesia, Vietnam and even China in the third quarter, the PSA said in a statement on Thursday.
Manufacturing, construction, trade and real estate drove economic growth, but the biggest story for the third quarter was the much-awaited recovery of agriculture.
The sector snapped five straight quarters of decline and finally shook off the effects of El Nino earlier this year.
The agriculture sector grew by 2.3 percent in the July-September period, overturning the 0.1 percent decline it saw the year prior. The PSA said palay and corn harvests have improved significantly since the drought.
Industry, meanwhile, expanded by 8.6 percent on the back of robust public and private construction.
Lastly, services — the largest contributor to the Philippine economy — rose by 6.9 percent in the third quarter. All the services subsectors, including transport, finance, education and recreation, showed positive growth.
With the domestic economy healthy, all eyes are now on external factors that could stall the country’s momentum for the rest of the year.
The election of Donald Trump as the next United States president was tagged as one of the most crucial issues, both by government officials and private sector analysts.
The National Economic and Development Authority (NEDA) is already mapping out the different scenarios of a Trump presidency and how this could affect the Philippines, Deputy Director-General Rosemarie Edillon said in a press briefing.
Trump has been a vocal supporter of protectionist policies throughout his campaign. He has promised to create more jobs for Americans by clamping down on outsourcing and tightening immigration rules.
According to a report by HSBC economist Joseph Incalcaterra, the country’s business process outsourcing (BPO) industry is the most exposed to risk, since they earn about 70 percent of their revenues from the U.S.
The consequences could go beyond the industry, he added, as BPOs employ about 1.2 million Filipinos.
On the upside, Incalcaterra said Filipino BPO workers posed “little direct competition with American workers.”
President Rodrigo Duterte has also “struck a more conciliatory tone” and hinted at better U.S.-Philippine ties in the future, he added.
Overseas Filipino Workers (OFWs) could also be affected, especially if Trump follows through with threats to kick out illegal immigrants, Edillon said.
“Of course, this will have an effect on remittances,” she admitted. The U.S. is the country’s biggest source of remittances. Filipinos there sent home more than $6.5 billion as of the third quarter.
NEDA estimates, though, that less than 10 percent of Filipinos in the U.S. are on irregular work contracts.
Edillon said the Philippines could readily absorb these displaced workers, if ever. “These are really, very highly employable individuals, and the different sectors of the economy are still expanding.”