The Philippine economy managed to grow in the first semester of 2014 despite the haunting

effect of Typhoon Yolanda that hit the country during the Q4 of 2013 and the lingering weakness
of the global economy. For the first semester of 2014, Gross Domestic Product (GDP) grew by
6.0%, relatively slower than 7.8% reported in the first semester of 2013. Meanwhile, Gross
National Income (GNI) accelerated by 7.2% from 6.8% in the first semester of 2013 [NSCB,
August 2014]. Economic growth for the first semester of 2014 is driven mainly by robust private
consumption and recovering net exports.

Household consumption continued to expand in the Q2 of 2014 by 5.3% relative to the 5.1%
reported in the Q2 of 2013. This reflected the upbeat consumer sentiment despite the higher
inflation recorded in the period. Possibly the impact of a higher inflation was partly moderated by
the weakening of the Philippine Peso. Household expenditure items that boosted the growth
were food and non-alcoholic beverages, alcoholic beverages and tobacco, clothing and
footwear, furnishing, transport, health and restaurant and hotels while miscellaneous goods and
services, utilities, recreation and education posted decelerated growth [NSCB, Highlight Report].
Philippine external market is a bright spot in the growth of the economy. Total exports grew by
10.3 % in Q2 2014, a rebound from the 7.7% contraction in Q2 2013. Electronics
manufacturers, the countrys largest exporters, improved their export growth forecast for the
year to 8% from the previous 5% [Business World Online, 7% growth possible in Q3,
September 30, 2014] with demand expected to improve on the back of the economic recovery in
the industrys major export markets like the United States and China and the lifting of Manilas
extended truck ban.

Investment in fixed capital formation and in construction plunges.

Government expenditure decelerated sharply and public construction fell due to the slowdown
of major government expenditures for salaries and wages as well as MOOE for the
implementation of programs and projects amid concerns over the misuse of government funds.
However, slowdown in disbursements in Personal Services and Maintenance and Other
Operating Expenditures (MOOE) led to the nil growth in government consumption.

References:
http://www.nscb.gov.ph/sna/2014/2nd2014/2014qpr2.asp
http://www.nscb.gov.ph/sna/2014/2nd2014/tables/Highlights%20Q2%202014.pdf