MANILA, Philippines (AP) — The Philippine economy grew 6.5 percent in the second quarter from a year ago, boosted by strong industry, farm recovery and with the services sector rising slower but remaining a main driver of growth, officials said Thursday.
"We are all well on track to meeting our full-year target growth of 6.5-7.5 percent," Economic Planning Secretary Ernesto Pernia told reporters, saying achieving the lower to middle range of the target is "still realistic."
The second quarter performance is below the 7.1 percent growth in the same period a year ago, when election-related spending boosted the economy. But it is slightly up from the first quarter 2017 rise of 6.4 percent. It brings first semester growth to 6.4 percent, lower than 7.0 percent in the same period last year.
Pernia said private consumption slackened but was offset by a boost in government spending, which rose to 7.1 percent from a meager 0.1 percent in the first quarter.
Industry recorded the fastest growth at 7.3 percent. Services slowed down to 6.1 percent compared with its 8.2 percent growth in the same quarter of the previous year. Agriculture recovered, rising 6.3 percent from a 2.0 percent decline in the previous year.
Analysts say the economy's underlying momentum has mildly moderated.
Zhi Huani of the Singapore Treasury Division of Mizuho Bank said growth in remittances and consumption are slower while investments may be hampered by softer capital expenditure and slower realization of public infrastructure projects. Martial law in the southern third of the country in response to Islamic State-linked militants' siege on Marawi city has also put a dent on confidence, as shown in the dismal performance of the Philippine peso this year, he added.