Philippines: Growth Rate of the Gross Domestic Product (GDP) from 2001 to 2020 and Average Annual Growth

Rate from 2000 to 2020 (of every 5 years).

15 12

10
10

8
5

0
2000 - 2001 - 2002 - 2003 - 2004 - 2005 - 2006 - 2007 - 2008 - 2009 - 2010 - 2011 - 2012 - 2013 - 2014 - 2015 - 2016 - 2017 - 2018 - 2019 - 4
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
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Annual Growth Rates, at Current Prices (GDP) Annual Average Growth Rate: 2001 - 2005
Annual Average Growth Rate: 2006 - 2010 Annual Average Growth Rate: 2011 - 2015
Annual Average Growth Rate: 2016 - 2020

Analysis

Annual Growth Rates:

The figure above indicates the growth of the Gross Domestic Product (GDP) in the Philippines from 2000 – 2020. Gross Domestic Product refers to the standard
measure of the value of final goods and services produced within a country by year. Notably, GDP is a significant indicator of a country’s economic growth and/or
decline.
The Annual Growth Rate fluctuations within the graph has indicated the constant shift or the inconsistent rate of growth that spans over the two decades.

Average Annual Growth Rate (AAGR)

• An Average Annual Growth Rate refers to the average growth rate of GDP over a specified period.

AAGR: 2001 – 2005

• As indicated by the figure above, the Average Annual Growth of the Philippine Gross Domestic Product from years 2001 – 2005 amounted to an average
rate of 9.875.
AAGR: 2006 – 2010
• As indicated by the figure above, the Average Annual Growth of the Philippine Gross Domestic Product from years 2006 – 2010 amounted to an
average rate of 9.735.
AAGR: 2011 – 2015
• As indicated by the figure above, the the Average Annual Growth of the Philippine Gross Domestic Product from years 2011 – 2015 amounted to an
average rate of 8.217.
AAGR: 2016 – 2020
• As indicated by the figure above, the average annual growth of the Philippine Gross Domestic Product from years 2016 – 2020 amounted to an average rate
of 5.442.

Implications and Reasons

As evident in the figure above, the annual growth rate from 2007 – 2008 clearly displays an economic decline. This occurrence stemmed from the financial
deregulation of 2008 titled the “2008 Global Financial Crisis”. The 2008 Global Financial Crisis may be explained to as a phenomenon characterized by high rates
of stress in both financial markets and banking systems globally.

In 2014, the supreme court of the Philippines has overruled and deemed a government projects called the Priority Development Assistance Fund (PDAF) and the
Disbursement Acceleration Program (DAP). It was the year filled with controversy in the government. The controversy has changed some view and lowered some
confidence in the governance. This led to the government not using the funds. Not utilizing the fund lowers the government spending. When the government spending
decreased, the government final consumption expenditure also decreased. This explains the low growth rate in the year 2014.

The pandemic has immobilized most of the economic activities here in the country. From the food industry to transportation, from leisure and accommodations to
education, these sectors have endured and suffered and continues to do so because of the pandemic. The GDP growth rate rendered a plummet of –7.9% recorded
by the Philippine Statistics Authority. It does not help that the economy pre-pandemic was already suffering because of the governments mass infrastructure programs
that had latent returns. It also does not help that the business confidence in the Philippines as a country for investor began to decline.
 Philippines: GDP Indusrial Origin Approach (2000 - 2020)
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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Services 3,688, 3,830, 3,974, 4,185, 4,532, 4,771, 5,078, 5,468, 5,686, 5,881, 6,326, 6,652, 7,144, 7,684, 8,201, 8,809, 9,529, 10,230 10,920 11,740 10,667
Industry 2,233, 2,263, 2,346, 2,462, 2,571, 2,701, 2,802, 2,940, 3,101, 3,057, 3,358, 3,411, 3,674, 3,924, 4,218, 4,493, 4,861, 5,202, 5,582, 5,843, 5,077,
Agriculture 1,064, 1,105, 1,144, 1,197, 1,257, 1,301, 1,360, 1,433, 1,482, 1,480, 1,499, 1,550, 1,598, 1,645, 1,676, 1,688, 1,672, 1,743, 1,762, 1,783, 1,780,

It is apparent that the most contributing sector in the Industry origin approach for the Philippine Gross Domestic Product all throughout 2000 until 2020, was the
services sectors. Following to it was the industry and the last being agriculture. Under the services sector were wholesale and retail trade; transportation and
storage; accommodation and food service activities; and etc. The Industry origin approach gave a hindsight or an idea that the Philippine economy is dependent on
its ability in offering and performing services. The services sector has been contributing more than half of the Gross Domestic Products to date.

Philippines: Final Expenditure Approach (2000 - 2020)

100%

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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Statistical discrepancy 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 69,638
Less: Imports of goods and services 2,103,2,284,2,446,2,576,2,661,2,760,2,771,2,764,2,896,2,828,3,415,3,383,3,612,3,865,4,247,4,885,5,804,6,683,7,662,7,803,6,095,
Exports of goods and services 1,770,1,731,1,815,1,983,2,112,2,376,2,616,2,690,2,575,2,453,2,952,2,929,3,061,3,121,3,500,3,849,4,203,4,935,5,518,5,650,4,703,
Gross capital formation 1,133,1,365,1,457,1,451,1,540,1,473,1,321,1,431,1,815,1,706,2,226,2,169,2,287,2,709,2,933,3,326,4,018,4,456,4,959,5,083,3,265,
Government final consumption expenditure 828,73817,76787,83821,02838,40863,35968,391,037,1,042,1,157,1,205,1,228,1,419,1,489,1,543,1,665,1,821,1,939,2,199,2,410,2,661,
Household final consumption expenditure 5,356,5,567,5,851,6,166,6,530,6,820,7,105,7,447,7,734,7,930,8,215,8,671,9,260,9,799,10,36611,03411,82312,52713,25014,02712,921

As indicated by the figure above, the sector with the largest influence in the computation of GDP in years 2000 –2002 was the “Household final consumption
expenditure”, within the two decades, household final consumption expenditure averaged 8,971,854. Expenditure refers to the activities that contribute towards Gross
Domestic Product in terms of consumption, production, capital, imports, and exports. On the other hand, industry refers to the activities that contributes to the Gross
Domestic product in terms of the type of industry; may it be agriculture, the industry, and the service sectors. These factors are used differently in describing the
contributions of differing sectors of players in the economy. These approaches give light as to how the Philippines functions as an economy. It is essential, especially
in policymaking, international trading, and social mobility that the economy is viewed with different approaches for it gives the users of the data an idea as to how
resources, capital, consumption, production, etc. should be managed in the economy.

GDP represents the total amount of output in the economy. This signifies that GDP may indicate how much a person under an economy may get with respect to the
activity of the government, the household, and the firms. This is further used to differentiate and compare different GDP of countries that merely relates the countries’
standard of living. The higher the GDP, the wealthier the nation. When the nation is equally wealthy, then they achieve a higher standard of living. Measurements
of Standard of living heavily relies on the changes in the GDP. Primarily, an economy with a more consistent and stable GDP growth rate can hardly fluctuate and
change. If the GDP growth rate fluctuates, it signifies instability. Thus, with stability comes a good standard of living.
References

References
Albert, J. (2015). What happened to the Philippine economy in 2014?. Retrieved 10 March 2021, from https://www.rappler.com/voices/thought-leaders/philippine-
economy-2014
Amadeo, K. (2020). 2008 Financial Crisis Causes, Costs, and Could It Happen Again?. Retrieved 10 March 2021, from https://www.thebalance.com/2008-financial-
crisis-3305679
Annual National Accounts Linked Series (2000-2020). (2021). Retrieved 10 March 2021, from https://psa.gov.ph/national-accounts/base-2018/data-series
Jiao, C. (2021). Philippines Plunges Into Recession and Cuts 2020 GDP Outlook. Retrieved 10 March 2021, from https://www.bloomberg.com/news/articles/2020-
08-06/philippine-economy-plunges-into-recession-as-gdp-contracts-16-5