NEDA sees ‘softer’ 3Q economic growth

The National Economic and Development Authority (NEDA) on Friday said the country’s gross domestic product (GDP) growth for the third quarter of 2010 would make a “soft landing."

According to the NEDA a "soft landing" means that the rate of economic growth is high enough to avoid recession but slow enough to avoid high inflation.

“We are expecting growth for the third quarter to be softer because election spending and the benign global economy are not there like in the first semester," NEDA Director General and Socioeconomic Planning Secretary Cayetano Paderanga said in a statement.

The country’s real GDP grew 7.8 and 7.9 percent, respectively, in the first and second quarters of 2010. The government targets real GDP to grow from 5 to 6 percent for 2010.

“We still want to have a higher growth rate for this year. We are hoping that the momentum is still there and we may actually go beyond the upper level of the target for 2010," Paderanga said.

In the second quarter, all subsectors in the industry sector expanded vigorously, led by activities in construction (22.6 percent) and manufacturing (12.4 percent).

The growth in the services sector was due to improved market sentiment, continued recovery in the global economy, and election-related spending, the NEDA said.

Domestic demand also continued to significantly support overall economic growth as both consumer and investor confidence held up well in the second quarter.

The national income accounts of the country for the third quarter of 2010 will be released on Nov. 25.