MANILA, Philippines (AP) — The Philippine economy expanded 7.5 percent in the second quarter, still one of Asia's fastest growing, as robust domestic spending insulated it from weak global demand.
The National Statistical Board said Thursday the latest figure brings first-half growth to 7.6 percent, the highest since reformist President Benigno Aquino III took office in 2010 on a promise to fight corruption and reduce poverty. It said service industries remained the main contributor to growth.
Gross domestic product expanded a revised 7.7 percent in the first quarter. Many other Asian nations are not faring so well, partly because of higher reliance on export manufacturing. China's growth eased to a two-decade low in the second quarter and Thailand's economy contracted.
Still, the Philippine stock exchange and the local currency have taken a beating in recent weeks as investors pull out of emerging markets. Such economies have been roiled by the prospect the U.S. central bank will ends its stimulus program and more recently, on concern over possible U.S. military action in Syria, which has boosted oil prices. The Philippines is a net crude importer.
Socioeconomic Planning Secretary Arsenio Balisacan said the latest GDP figure confirms the Philippine economy "is now at a higher growth trajectory" — the fourth consecutive quarter that the economy grew above 7 percent.
Finance Secretary Cesar Purisima said the Philippines is differentiating itself from other developing economies that are highly reliant on exports for growth.
"I am confident that market players will recognize the strong fundamentals of the country- including our strong external position and banking system, stable inflation, and a well-managed fiscal position. All of this is topped by a reform-oriented political leadership with a very strong mandate," he said.
Despite the recent gains, foreign direct investment still lags behind other Southeast Asian economies. Balisacan said it is vital for the economy "to keep investments growing to create more high-quality jobs and reduce poverty."
The government also needs to speed up state spending on infrastructure projects such as roads, bridges, ports and airports, to facilitate job creation and better communication across the sprawling archipelago nation.
"We are seeing rebalancing. We want to diversify sources of growth. Investments, industrialization are key," Balisacan told reporters.
A recent corruption scandal involving the disbursement of development funds to lawmakers, which led Aquino last week to announce the overhaul of the entire funding system, has caused concern that state spending may be adversely affected.