Despite the oil and consumer price increases, the Philippine economy continued to show strength, with sustained gains during the second quarter of 2004 as the Seasonally Adjusted Gross Domestic Product (SAGDP) posted a quarter-on-quarter growth of 1.4 percent. The Seasonally Adjusted Gross National Product (SAGNP) also grew, albeit at a slower pace, registering a growth of 1.2 percent. The big turn around of agriculture, fishery and forestry (AFF) from a contraction during the previous quarter more than made up for the weakened performance of the industry sector despite the deceleration of the services sector. The seasonally adjusted estimates of AFF accelerated to 6.5 percent while that of services sector slowed down to 0.4 percent. On the other hand, the industry sector contracted by 0.1 percent.

Original Data vs.
Seasonally Adjusted Gross Domestic Product

PERSONAL CONSUMPTION EXPENDITURE

On the demand side, the Seasonally Adjusted Personal Consumption Expenditure (SAPCE) continued to grow but at a slower rate of 0.7 percent from 1.8 percent during the second quarter. Nonetheless, it remained a major impetus to the domestic economy.

AGRICULTURE, FISHERY AND FORESTRY

The agriculture, fishery and forestry sector expanded by 6.5 percent, a robust turn around from the previous quarter contraction of 4.2 percent. The surge in the AFF sector was attributed to the improved performances of palay, corn and fishery. The growth of the AFF was the highest since the first quarter of 1999.

INDUSTRY

After posting a growth of 1.1 percent during the second quarter of 2004, the industry sector contracted by 0.1 percent in the current quarter due to the contraction of the mining and quarrying sub-sector and the deceleration of the electricity and water sub-sector.

SERVICES

The services sector decelerated to 0.4 percent during the third quarter of 2004 after posting a large growth of 3.3 percent. All sub-sectors contributed to the growth. Despite the deceleration, the services sector continued to gain importance in the Philippine economy.