Growth remained positive yet slower than the previous quarter, posting a 7.1 percent increase in third
quarter 2021 after a historic economic expansion of 12.0 percent in the second quarter.
The Philippines records second growth increase after successive contractions. Third
quarter GDP growth remained positive at 7.1 percent but slower than last quarter’s highest recorded
expansion since 1988 (12.0 percent). It remained strong, however, as it emulated pre-pandemic growth
despite the reimposition of an Enhanced Community Quarantine (ECQ) and the rise of the Delta
variant, the two factors responsible for the slower growth. While all components of aggregate demand
showed large improvements relative to their levels in third quarter 2020, a large slowdown in domestic
investment and a slight decrease in private consumption in third quarter 2021 offset the increase in
government expenditure compared to the previous quarter. Meanwhile, growth was positive yet not as
high as in the previous quarter for the Services and Industry sectors, and with a downtrend in the
Agriculture sector. Nevertheless, the third quarter promises consistent positive growth towards
pandemic recovery, indicating larger expansions in subsequent quarters. However, the medical crisis
and increasing unemployment rates remain important considerations for risk management. Hence, the
proper management of economic (both fiscal and monetary) policy together with health policy to ensure
increasing vaccination rates and preventing more waves of COVID-19 are key for the Philippine
economy’s growth recovery and resilience.
