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BusinessWorld Economy

Return to beyond-4% growth seen possible by 4th quarter

THE ECONOMY could return to an above-4% growth path in the fourth quarter, backed by record employment, stronger exports and remittances and an expected rebound in infrastructure spending, the University of Asia and the Pacific (UA&P) said. However, it said third-quarter growth could remain tepid at 2.3% due to delays in infrastructure spending and the […]

Context & Analysis

The practical issue for Philippine businesses is not just the direction of growth, but how evenly it reaches different parts of the economy. Public spending has long been a swing factor here: when projects are released on schedule, construction inputs, transport, local hiring and supplier contracts can move quickly; when timing slips, demand may concentrate in fewer sectors and leave other firms waiting for orders.

For companies, the second half is often where planning assumptions get tested. If household income improves and overseas funds keep arriving, consumption-linked businesses may see stronger foot traffic, service bookings and credit applications. At the same time, importers, manufacturers and lenders need to watch working-capital pressure, because a faster pace can mean larger inventories, tighter supplier terms and more competition for labor.

For consumers, the more useful measure is whether jobs translate into better pay and more stable cash flow. A pickup in project work can help construction-heavy provinces and small traders who supply food, materials and transport services. It can also affect prices and mobility costs if fuel, logistics or trade conditions tighten. In other words, macro growth only becomes meaningful when it shows up in wages, household budgets and local demand.

The coming weeks will be a reality check. Watch for project awards, disbursement patterns, permits, supplier contracts and hiring trends in infrastructure-linked industries. Also monitor export orders, remittance flows and monetary policy moves as inflation and credit conditions evolve. If fiscal execution improves without bottlenecks, firms may gain confidence to invest; if delays continue, growth could remain uneven even where labor and external indicators look strong.

Analysis by IJE Software — original commentary on the story above.

This is an excerpt. Read the full article at the original source:

Source: bworldonline.com

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