Philippines GDP has always grown strongly in recent years despite many external factors. The economy of the Philippines is also thriving with a high growth rate.
The strength of the Philippine economy is the service sector and export industry. In particular, the information technology and online services industry is developing strongly and has potential for future development.
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What Is The Philippines Ranked In GDP?
In 2022, the Philippines achieved 7.6% of GDP, whose number is over the Government’s target despite high inflation.
The Philippine Government’s data showed over 5.7% gross domestic product growth recorded in 2021 and exceeded the Government’s forecast of 6.5% to 7.5%.
The Philippine economy is considered one of the fastest growing in Southeast Asia. Tourism is one of the Philippines’ major economies, thanks to its beautiful beaches, resort areas, and high-end developments.
In addition, the Philippines has a diversified economy that includes the export industry, financial services, manufacturing, and household goods. International investors are interested in the Philippines because of its extremely favorable business environment and low wages compared to other countries in Southeast Asia.
However, the Philippine economy still faces several problems, such as violence and chaos in security, management problems, and quality assurance.
Philippines GDP According To Each Sector
Economic resources are an important factor in assessing the strength of an economy. The Philippines has rich financial resources, with human resources, resources, and production as the three main factors. In each area, the Philippines has further developments.
Agriculture
The Philippines’ overall economic growth target for 2021 is between 6.5 and 7.5%, of which the agricultural sector is 2.5%. However, farm production last year fell (-3.3%) in the first quarter, negative 1.5% in the second quarter, negative 2.6% in the third quarter, and only 0.6% growth in the fourth quarter.
Low productivity has left the Philippine agricultural sector heavily protected over the years. The import of rice and vegetables has been opposed due to higher-than-normal prices, leading to instability as workers demand higher wages, which also affects the competitiveness of products domestically produced.
To drive growth, the Philippines will focus on expanding agribusiness, modernizing agriculture, promoting digital transformation, encouraging the private sector to participate in infrastructure development, and enhancing the competitiveness of local industries.
Industry
In July 2021, the Philippines’ industrial production index reached 90.6 points, up from 89.8 points in June 2021 but lower than 92 points in July 2020. The increase in industrial production in the Philippines in July 2021 was contributed by the rise in 15 out of 22 industries.
The industry is mostly concentrated in the cities around Manila, while Cebu is also becoming an attractive location for domestic and foreign investors in recent times. The mining industry also has great potential in the Philippines, possessing large reserves of chromite, nickel, and copper. Recently natural gas has been discovered and added to the energy reserve.
Services
The service sector has played an important role in the Philippine economy for many years. Not only contributing the largest to GDP growth, but the service sector also plays an important role in exporting and solving job pressure for the economy.
However, the development of the service industry in the past period also has limitations, including the unbalanced development of the industry when only focusing on a few large cities such as Manila and Cebu, the sector’s labor productivity is slow to improve. Meanwhile, legal challenges remain the main barrier to the steady development of the industry.
Frequently Asked Questions (FAQs)
Is The Philippines A High Income Country Or A Low-Income Country?
The Philippines is considered a lower-middle-income country. Its per capita income is lower than many developed countries and some of its neighboring countries in Southeast Asia. However, the country has been experiencing steady economic growth in recent years, and the Government has implemented various programs to address poverty and income inequality.
Its most recent GNI per person increased from $3,430 in 2020 to $3,640 in 2021. GNI is the collective revenue produced by a nation’s citizens inside and outside its borders.
Is The Philippine Economy Improving?
The Philippines will have one of the fastest-growing economies in the world over the next 40 years as developing markets in the region become a key driver of global growth by 2050.
According to the World Bank 2004, the Philippines was the 25th economy on the list of countries by GDP (PPP) by purchasing power parity. It is also one of the fastest-growing economies in Southeast Asia, with a GDP growth rate of 7.5% in the second quarter of 2007, and it is compared with the Indian economy in terms of rapid growth and mutation.
Why Is The Philippines Still A Developing Country?
When a nation experiences rapid population growth, low per capita income, dependence on the primary sector, high unemployment rates, and reliance on the export of basic commodities, it is categorized as a developing country.
Although the Philippines’ economy has expanded quickly since the 2000s, its average per-capita income is still far lower than developed nations, making it a developing economy. The country’s economy is now more than 61% dependent on services, accounting for most of its GDP.
Conclusion
Overall, the Philippines GDP growth rate shows that the country’s economy is thriving and has potential for future growth. However, it is necessary to have appropriate economic policies and cooperate with international organizations and neighboring countries to limit the bad effects and strengthen the financial strength of the Philippines.
Economic policy must have an overall vision and focus on key areas such as economy, production, materials, and human resources. Efforts to create an ideal economic environment will contribute to better and more sustainable GDP growth in the future.
