Download Recreational Services excites Private Services

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HIGHLIGHTS
Fourth Quarter 2010
Philippine economy posts 7.1 percent GDP growth
Despite the El Niño and the diminished government spending during the second
semester, the domestic economy sizzled to its highest annual GDP growth in the
post Marcos era of 7.3 percent in 2010 from 1.1 percent in 2009. The global
economic recovery which resulted in record growth rates of foreign trade and
election related stimuli that combined for a record first semester growth, followed
by the peaceful conduct of the national elections and the renewed trust in
government contributed to an economic performance in 2010 that well
surpassed the government’s target of 5.0 percent to 6.0 percent. Industry and
services sectors expanded strongly in the last quarter of 2010 while Agriculture
recovered after four consecutive quarters of decline due to El Niño, pushing
GDP to grow by 7.1 percent in Q4.
Industry accelerated to 8.3 percent from 3.8 percent, almost sustaining its third
quarter growth. Services likewise accelerated, growing by 6.9 percent from 3.1
percent.
And AFF, after being battered for four consecutive quarters by
abnormal weather conditions, rebounded by 5.4 percent from a decline of 2.9
percent.
On the Demand side, growth was led by investment in Durable Equipment, net
exports and consumer spending.
For the fourth quarter, the continuing, though much decelerated demand for the
services of our OFW’s caused NFIA to grow by 3.8 percent from 19.5 percent
last year, pushing GNP growth to 6.7 percent from last year’s 4.1 percent.
The seasonally adjusted estimates show a surging Philippine economy as GDP
jumped by 3.0 percent from a decline of 0.8 percent in the previous quarter while
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the seasonally adjusted GNP accelerated to 2.9 percent from a 0.2 percent
growth in the third quarter.
The AFF sector grew by 4.2 percent from a 1.0 percent growth in the previous
quarter largely due to the growth in Palay and corn. On the other hand, Industry
rebounded to a 6.7 percent growth from a 5.9 percent decline in the previous
quarter due to the expansion of Manufacturing and Mining & Quarrying.
Services sector, however, decelerated to 0.3 percent from 2.0 percent caused
partly by two consecutive quarters of decline in Government Services.
Per capita GDP in the fourth quarter rose by 5.0 percent from 0.2 percent in the
same previous last year. Per capita GNP and per capita PCE likewise posted
huge growths of 4.6 percent and 4.9 percent from 2.1 percent and 3.0 percent,
respectively.
PRODUCTION SIDE
Agriculture, Fishery and Forestry (AFF)
AFF rebounds
Agriculture, Fishery and Forestry, which accounted for 16.3 percent of total GDP,
rebounded to 5.4 percent from a decline of 2.9 percent last year, contributing 1.0
percentage point to the total GDP growth. Biggest contributors to growth were
Palay, Fishery, Corn, Poultry, and Livestock. The sub sectors that recorded the
fastest growth were Palay, Corn, and Poultry while those that lagged behind
were Forestry, Sugarcane, and Coconut.
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Palay, Fishery and Corn major growth drivers for Agriculture
Palay rebounded to a 21.1 percent growth from a decline of 13.8 percent while
Corn accelerated to 13.8 percent from 4.6 percent due to the favorable weather
conditions in almost all parts of the country.
Coconut including copra, reversed its growth to negative 2.4 percent from 2.2
percent registered in the same period last year. The decline can be attributed to
the dry spell in the previous quarters and the strong winds brought about by
typhoon Juan that caused falling of nuts in Northern Mindanao.
Likewise, Sugarcane declined by 28.2 percent from a growth of 14.6 percent due
to the adverse effects of long dry spell particularly in the provinces of Tarlac,
Nueva Ecija, and Batangas.
On the other hand, Banana posted a measly growth of 0.2 percent from 3.0
percent with the recovery of banana farms from the long dry spell. Similarly,
Other Crops grew by 0.7 percent from negative 3.1 percent with the increased
production of cassava, cabbage, onions, and rubber, among others.
Livestock turned around by 2.1 percent from a decline of 0.7 percent. Growth
was largely due to the increased number of slaughtered animals due to higher
demand during the holiday season.
Poultry rebounded to 5.2 percent from a decline of 1.9 percent in the previous
year, propped up by the bigger volume of broilers disposed by commercial farms
due to sufficient supply of day old chicks, higher inventory of laying flocks
coupled with increased egg-laying capacity ratios of layers in Central Luzon,
CALABARAZON, Bicol Region and Central Visayas and Northern Mindanao.
Duck and duck egg production, however, declined due to decreased number of
culled ducks available for disposal and drop in the total duck inventory during the
period. Likewise there was continuous decline in the number of layers and low
laying efficiency ratio due to unfavorable weather condition in the last quarter of
2010.
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Fishery production increases
Fishery accelerated to a growth of 3.7 percent in the fourth quarter of 2010 from
0.4 percent in 2009.
Aquaculture, the main source of growth of the fishery
sector, increased its investment and production due to high demand for brackish
water
species.
The
increased
harvest
of
aquaculture
species
was
complemented by good water and favorable weather conditions. The continuous
capability enhancement program and technical support program of BFAR further
boosted aquaculture production.
Forestry falls
The forestry sector declined by 46.8 percent from a growth of 39.6 percent
posted last year.
Industry, main drive of the economy
Industry, which accounted for 32.9 percent of total GDP, accelerated to 8.3
percent from 3.8 percent last year, contributing 2.7 percentage points to the total
GDP growth. The biggest contributors to growth of Industry were Manufacturing,
Mining & Quarrying and Electricity, Gas & Water.
Mining and Quarrying sustains growth
Mining and Quarrying grew by 15.5 percent in the fourth quarter of 2010 from
17.0 percent the previous year due to the significant contribution of Other Non
Metallic Minerals. Other Non Metallic Minerals, mostly coal, surged to a growth
of 35.0 percent from 9.8 percent in the previous year.
Nickel Mining, on the other hand, rebounded to a growth of 59.9 percent from a
decline of 25.0 percent registered the previous year while Stone Quarrying, Clay
& Sandpits, grew by 17.2 percent from 16.9 percent. Other minerals that posted
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positive growth were: Gold Mining, up by 5.2 percent from 40.6 percent; Copper
Mining, 8.6 percent from 139.9 percent; and, Chromium Mining, 20.8 percent
from 130.4 percent.
In contrast, Crude Oil, which includes Natural Gas & Condensate, and Other
Metallic Minerals pulled down the growth of the sector with a decline of 9.4
percent and 12.6 percent from a growth of 10.8 percent and 392.1 percent,
respectively.
Manufacturing accelerates
Manufacturing accelerated to 8.9 percent in the fourth quarter of 2010 from 3.9
percent in 2009.
The leading contributor to the growth of the sector was Food Manufactures,
which posted an accelerated growth of 8.5 percent from 1.9 percent registered
last year followed by Miscellaneous Manufacturing, 33.9 percent from 12.9
percent, Electrical Machinery, 9.3 percent from 31.7 percent; Products of
Petroleum and Coal, which posted a double digit growth of 7.4 percent from 1.9
percent; and, Chemical and Chemical Products, 12.6 percent from 2.7 percent.
On the other hand, the following pulled down the growth of the sector: Tobacco
Manufactures which reversed its growth of 16.4 percent to negative 48.1
percent; Basic Metal Industries, declined by 2.7 percent from 1.1 percent;
Leather and Leather Products, negative 17.9 percent from negative 36.7
percent; and, Wood & Cork Products, negative 1.5 percent from negative 3.1
percent.
Construction sustains growth
Construction continued to post gains in 2010 with 2.4 percent from 1.1 percent
registered in the previous year benefiting from the projects of the private sector.
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EGW accelerates
Electricity and water accelerated to 8.5 percent in the fourth quarter of 2010 from
0.1 percent in the previous year. Electricity, which accounts for about 93 percent
of the total sector, rebounded to 8.8 percent from a decline of 0.3 percent in the
same period last year.
The growth in electricity can be attributed to the
increased demand by almost all sectors in the holiday season.
Water sub sector, on the other hand, decelerated to 4.3 percent from 5.6 percent
in the same period last year.
Services
Services still resilient
Services, with a share of 48.4 percent of total GDP, contributed 3.3 percentage
points to the total GDP with a growth of 8.3 percent from 3.8 percent. Major
contributors to the sector’s growth were Trade, Private Services and Finance.
TCS rebounds
Transportation, Communication and Storage rebounded to 1.5 percent from a
decline of 2.6 percent in the fourth quarter of 2009 in the same period last year
brought about by the turned around growth of Transport and Storage from
negative 1.9 percent to 4.7 percent.
The subsectors of Transport and Storage that contributed to the rebound of the
sector were: Air Transport, 22.9 percent from 4.5 percent; Land Transport, 1.7
percent from 0.9 percent; Water Transport, 6.6 percent from negative 27.1
percent; and, Storage & Services Incidental to Transport (SSIT), 12.1 percent
from negative 1.4 percent
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Communications, the leading contributor to TCS growth, declined at slower pace
of 0.5 percent from negative 3.1 percent, as consumer demand for
communication services slackened.
Trade expands
Trade Services expanded its growth to 8.8 in the fourth quarter of 2010 from 2.6
percent in the previous year. Retail Trade, which comprises the bulk of total
Trade, speed up its growth from 9.2 percent to 10.1 percent as prices of retail
commodities decelerated. Likewise, Wholesale Trade recovered from a decline
of 16.7 percent in the previous quarter to 4.0 percent.
Finance hikes growth
Financial Services hiked its growth by 9.7 percent from 6.0 percent posted last
year. Banks, the biggest contributor to the growth of the sector, recorded 9.3
percent growth from 11.0 percent.
Meanwhile, Non Banks, which include financial services from investment
companies, security dealers, brokers & pawnshops, and Insurance rebounded to
a growth of 12.6 percent and 9.8 percent from negative 0.3 percent and negative
7.3 percent, respectively.
Ownership of Dwellings and Real Estate hastens growth
Ownership of Dwellings and Real Estate (ODRE) accelerated to 8.0 percent in
the fourth quarter of 2010 from 3.2 percent in the previous year.
Real Estate soared by 20.6 percent from 3.9 percent posted during the fourth
quarter of 2009. Ownership of Dwellings which accounts for about 69.0 percent
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of ODRE, grew by 3.2 percent, highest since the 3.9 percent growth in fourth
quarter of 1996, from 2.9 percent the previous quarter.
Recreational Services excites Private Services
Private Services accelerated to 10.6 percent, the highest since the 10.7 percent
growth posted in the fourth quarter of 2004, from 8.9 percent. Recreational
Services posted the fastest growth with 42.1 percent from 21.4 percent followed
by Hotels and Restaurants, 10.9 percent from 2.2 percent; Business Services,
which include the Business Processing Outsourcing (BPO) industry, 9.5 percent
from 19.8 percent; Other Services, which include waste collection and disposal
and other sanitary and similar services, 6.5 percent from 8.8 percent; Medical
Services, 3.7 percent from 4.0 percent; and, Educational Services, 1.3 percent
from 2.7 percent
On the other hand, Personal Services, which include laundry services, spas,
beauty parlors and other related services, reversed its growth of 2.0 percent
recorded the previous year to negative 0.3 percent.
Government Services declines
Government services declined by 4.3 percent during the fourth quarter of 2010
from 2.7 percent in the previous year. This can be attributed to the lower than
programmed releases from personal service items and other compensation.
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EXPENDITURE SIDE
High Consumer spending boosts Personal Consumption Expenditure
(PCE)
Personal Consumption Expenditure (PCE) accelerated to 7.0 percent in the
fourth quarter of 2010, the highest since the 8.4 percent growth recorded in the
third quarter of 1988, from 5.0 percent in the same period last year.
Food
expenditures, which accounted for about 56.0 percent of PCE grew by 7.0
percent from 5.4 percent in the previous year. Likewise, Miscellaneous
expenditures expanded by11.0 percent from 6.8 percent while Household
Furnishing grew by 10.4 percent from 16.7 percent.
The other expenditure items that accelerated were: Clothing and Footwear, 9.7
percent from 1.8 percent; Household Operations, 3.8 percent from 3.1 percent;
Fuel, Light and Water, 8.7 percent from 0.1 percent; Transportation and
Communication, 2.5 percent from negative 0.5 percent; and Beverage, 12.2
percent from negative 3.5 percent.
On the other hand, expenditures on Tobacco declined by 10.8 percent from a
growth of 14.1 percent.
Government Consumption Expenditure (GCE) dives
Government Consumption Expenditure (GCE) declined by 7.6 percent from a
growth of 13.7 percent last year, as the government remained cautious in its
expenditure management to keep attune with the government’s revenue
collection for the period.
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Fixed Capital Formation soars
Investments in Fixed Capital Formation grew robustly with 22.8 percent, the
highest since the 27.3 percent of the fourth quarter 2000, from last year’s growth
of 5.8 percent as a result of accelerated investments in Durable Equipment.
Investment in Construction expands
Investments in Construction expanded by 3.4 percent from 2.4 percent.
Investment in Private Construction boosted the growth of the sector with 14.6
percent from a decline of 0.4 percent.
On the other hand, Public Construction pulled down growth of the sector with its
decline of 14.3 percent from 7.2 percent.
Business Confidence hikes investments in Durable Equipment
Business confidence hiked investments in capital formation for Durable
Equipment as it grew by 26.8 percent from 13.8 percent. Increased investments
were registered in eighteen (18) out of the twenty (20) types of fixed asset
investments.
The increased investments during the quarter were posted by: Road Vehicles,
37.6 percent from 47.9 percent; Air Transport, 1964.3 percent from negative 89.9
percent; Other Miscellaneous Durable Equipment, 23.0 percent from 9.1 percent;
Telecommunications and Sound Recording/Reporting Equipment, 12.0 percent
from 44.2 percent; and, Other Special Industrial Machineries, 41.2 percent from
negative 24.6 percent
On the other hand, the following sub sectors posted declines in investments:
Tractor Other Than Steam, plunged deeper to negative 10.4 percent from
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negative 2.5 percent and Water Transport declined to 1.3 percent from a growth
of 15.7 percent.
Investments in Breeding Stocks and Orchard Development boost BSODA
Investments for the combined Breeding Stocks, Orchard Development and
Afforestation (BSODA) rebounded to 2.9 percent from a decline of 2.5 percent
recorded the previous year boost by increased investment in Breeding Stocks
and Orchard Development.
Agriculture main contributor to the accumulation in Stocks for the 4 th
Quarter
Total stocks in the fourth quarter of 2010 amounted to P4,015 million compared
to the withdrawal of P1,420 million in 2009. Additions to stocks for this period
were largely attributed to the increased stocks of rice, sugar and product of
Petroleum.
Total Exports Expands
The growth of Total Exports expanded by 21.1 percent, the lowest for year 2010,
from a decline of 6.7 percent registered in the fourth quarter of the previous year
as both Merchandise Exports and Non Merchandise Exports posted robust
growths.
Merchandise Exports on the upswing
Total Merchandise Exports rebounded to 16.4 percent from a decline of 5.0
percent in the same quarter of last year due to the turn around in growth of
Principal Merchandise Exports by 24.6 percent from negative 2.8 percent.
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The top five Merchandise Exports that contributed most to the sector were:
Finished Electrical Machinery, 43.5 percent from 25.2 percent; Semiconductors
and Electric Microcircuits, which rebounded to 52.4 percent from negative 7.5
percent; Garments, 10.3 percent from negative 22.5 percent; Petroleum
Naphtha, 128.5 percent from 1.3 percent; and, Crude Coconut Oil, 5.2 percent
from 4.3 percent.
On the other hand, the following commodities pulled down the growth of the
sector: Iron Agglomerates, which slumped by 53.2 percent from a growth of
115.0 percent; Dessicated Coconut, negative 39.8 percent from negative 51.6
percent; Centrifugal Sugar, negative 100.0 from 20.4 percent; Transmission
Apparatus, negative 22.2 percent from 114.7 percent; and, Cathodes & Section
of Cathodes of Refined Copper, negative 59.6 percent from negative 45.8
percent.
Export of Non-Factor Services rebounds
Exports of Non-Factor Services rebounded to 43.5 percent from a decline of 13.9
percent in the previous year. Miscellaneous Services which turned around to
60.1 percent from negative 13.8 percent boosted the growth of the sector.
The other subsectors that contributed to the upswing of the sector were:
Transportation, which rebounded to 47.5 percent from negative 40.8 percent;
Travel, 13.3 percent from negative 9.2 percent; and, Insurance, 76.6 percent
from 115.0 percent.
Total Imports accelerates
Total imports accelerated to 21.8 percent from 6.8 percent in the previous year
as both Merchandise Imports and Non Merchandise imports recorded double
digit growths.
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Total Merchandise Imports on the upturn
Total Merchandise Imports posted 21.1 percent growth in the fourth quarter of
2010 from 7.5 percent last year.
The five sub sectors that contributed positively to the growth of the sector were:
Electrical Machinery, Apparatus and Appliances, 28.1 percent from 32.7 percent;
Transport Equipment, 72.2 percent from negative 13.0 percent; Machinery other
than Electrical Machinery, 12.4 percent from 12.5 percent; Mineral Fuels,
Lubricants and Related Materials, 15.6 percent from negative 21.6 percent; and,
Chemical Elements & Compounds, 30.2 percent from 27.9 percent.
On the other hand, the decline of the following subsectors pulled down the
growth of the sector: Fertilizers, 22.2 percent from a growth of 94.0 percent;
Feeding Stuff, 10.6 percent from a growth of 9.0 percent; and, Paper Products,
4.1 percent from a growth of 30.7 percent.
Import of Non-Factor Services surges
Imports of non-factor services rebounded to 30.4 percent from a decline of 1.1
percent enhanced by the positive growth of all its subsectors. The principal
contributor to the growth of the sector was Travel which grew by 25.5 percent
from zero.
Likewise, Miscellaneous Services, rebounded to 30.1 percent from a decline of
17.6 percent; Transportation, grew by 45.9 percent from 38.9 percent;
Government Services, upped by5.2 percent from 3.0 percent; and, Insurance,
turned around to 41.4 percent from a decline of 18.8 percent.
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Trade Balance posts deficit
In the fourth quarter of 2010, Total Exports, valued at P733.96 billion pesos fell
behind Total imports, valued at P773.72 billion pesos at current prices, resulting
to a trade deficit of P39.77 billion pesos.
The current trade deficit stood at 1.4 percent of GNP from last year’s negative
0.09 percent.
Trade Index favorable
The terms of trade during the quarter posted a Trade Index of 134.2 percent
from 141.3 percent in 2009. Trading Gain for the quarter amounted to P54.06
billion pesos.
GNP Implicit Price Index (IPIN) stood at 564.5 percent from 550.8 percent in the
previous year or a 2.5 percent growth from 2009.
Revisions in Q3 2010 GDP/GNP estimates
Based on the Revision Policy approved by the NSCB Executive Board through
NSCB Resolution No. 8-97, and consistent with the international practice on the
revision of National Accounts, we are reflecting the corrections and revisions in
our previous estimates, based on the revisions and updates made by the data
sources themselves, including those made by NSO, BSP, DOE, DBM, POEA,
BAS, SRA, FMB, water utilities, and airline companies.
For the third quarter, the largest contributors to the revision of GDP were
Construction and ODRE with negative 0.18 percentage point each.
downward contributions on the production side came from:
Other
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a) Government services with negative 0.13 percentage point;
b) Manufacturing and c) forestry with negative 0.06 percentage point
each; and
d)
Agriculture and fishery with negative 0.03 percentage point,
On the other hand, upward revisions came from:
a) Trade with 0.21 percentage point;
b) Private services with 0.17 percentage point;
c) Mining and quarrying with 0.04 percentage point;
d) TCS, and e) EGW with 0.03 percentage point each; and
f) Finance with 0.002 percentage point.
Meanwhile, NFIA contributed negative 1.42 percentage points to the downward
revision of GNP.
As a result of all the revisions for the third quarter, GDP growth was revised
downward by 0.2 percentage point from 6.5 percent to 6.3 percent while GNP
was revised downward by 1.5 percentage points from 7.5 percent to 6.0 percent.
A more complete tabulation of the revisions is included in the publication.