Interviews
ADB forecasts stable outlook for Southeast Asia
10 Dec '15
7 min read
Driven largely by strong domestic demand, GDP growth in the Philippines picked up to 6 per cent in the third quarter, bringing growth in the first three quarters to 5.6 per cent. Private investment recorded robust expansion, and household spending was supported by higher employment, low inflation, and remittance inflows from Filipino workers overseas. Government expenditure accelerated rapidly, with public expenditure rising by 41.2 per cent in the third quarter as budget execution was enhanced. Net external demand weighed on GDP growth in the first three quarters, however, reflecting brisk expansion in imports on strong domestic demand and only a modest rise in merchandise exports. The unexpectedly sharp drop in net external demand prompts a small downward revision in the growth forecast to 5.9 per cent in 2015. The growth forecast for 2016 is maintained at 6.3 per cent.
On the supply side, services and manufacturing were the key growth drivers. Services generated two-thirds of GDP growth in the first three quarters, spurred by transport, communications, retail trade, business process outsourcing, and real estate. Manufacturing generated nearly one-fourth of the increase in GDP, supported by domestic demand. Agricultural output was nearly flat in the first three quarters as El Niño brought drought.
The Thai economy expanded by 2.9 per cent year on year in the first three quarters of 2015. Third quarter growth was also 2.9 per cent year on year, in line with expectations. Private consumption remained weak as consumer confidence continued to decline and household debt remained high. Private investment contracted further as the business sentiment index continued to decline. Public investment growth slowed in the third quarter but was still high at 17.5 per cent year on year. On the production side, agriculture contracted by 5.9 per cent in the first three quarters of 2015 while manufacturing increased by 0.8 per cent from a year earlier.
Merchandise exports showed signs of improvement as they contracted by only 1.9 per cent following declines of 4 per cent in the second quarter and 2.5 per cent in the first. Exports of automotive products, integrated circuits, and air conditioners expanded well in the third quarter. Meanwhile, services continued to perform handsomely, expanding by 17.5 per cent year on year despite a slowdown in hotels and restaurants to 10.9 per cent in the third quarter—mainly a reaction to a deadly explosion in Bangkok in August. The growth outlook remains unchanged at 2.7 per cent for 2015 and 3.8 per cent for 2016.
In Singapore, the initial growth estimate for the third quarter of 2015 was 1.4 per cent year on year—a drop from the revised estimate of 2 per cent growth in the second quarter. Manufacturing was largely to blame for the sluggish growth, as it contracted steeply by 6 per cent in the third quarter with output declines for electronics, biomedical manufacturing, and transport engineering. Construction grew by 1.6 per cent, but this was less than the 2 per cent growth recorded in the previous quarter due to weaker private sector construction.
On the supply side, services and manufacturing were the key growth drivers. Services generated two-thirds of GDP growth in the first three quarters, spurred by transport, communications, retail trade, business process outsourcing, and real estate. Manufacturing generated nearly one-fourth of the increase in GDP, supported by domestic demand. Agricultural output was nearly flat in the first three quarters as El Niño brought drought.
The Thai economy expanded by 2.9 per cent year on year in the first three quarters of 2015. Third quarter growth was also 2.9 per cent year on year, in line with expectations. Private consumption remained weak as consumer confidence continued to decline and household debt remained high. Private investment contracted further as the business sentiment index continued to decline. Public investment growth slowed in the third quarter but was still high at 17.5 per cent year on year. On the production side, agriculture contracted by 5.9 per cent in the first three quarters of 2015 while manufacturing increased by 0.8 per cent from a year earlier.
Merchandise exports showed signs of improvement as they contracted by only 1.9 per cent following declines of 4 per cent in the second quarter and 2.5 per cent in the first. Exports of automotive products, integrated circuits, and air conditioners expanded well in the third quarter. Meanwhile, services continued to perform handsomely, expanding by 17.5 per cent year on year despite a slowdown in hotels and restaurants to 10.9 per cent in the third quarter—mainly a reaction to a deadly explosion in Bangkok in August. The growth outlook remains unchanged at 2.7 per cent for 2015 and 3.8 per cent for 2016.
In Singapore, the initial growth estimate for the third quarter of 2015 was 1.4 per cent year on year—a drop from the revised estimate of 2 per cent growth in the second quarter. Manufacturing was largely to blame for the sluggish growth, as it contracted steeply by 6 per cent in the third quarter with output declines for electronics, biomedical manufacturing, and transport engineering. Construction grew by 1.6 per cent, but this was less than the 2 per cent growth recorded in the previous quarter due to weaker private sector construction.
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